ASX ends its losing streak as Santa Rally kicks off

Welcome to your five-minute recap of the trading day.

The numbers

The Australian sharemarket closed higher on Tuesday, defying fears of the index extending its losing steak for a sixth day. The S&P/ASX 200 gained 64.5 points, or 0.8 per cent, to close at 8314 points, with eight of the 11 industry sectors rising.

The gains came despite traders bracing themselves for another day of declines, with futures pointing to a weak opening. The ASX lost 0.6 per cent on Monday, its fifth consecutive day in the red.

The Australian dollar saw marginal losses and traded at 63.51 US cents as at 4.55pm AEDT.

Wall Street has gained overnight. Credit: Bloomberg

The lifters

Industrials (up 1.3 per cent) were among the best performing sectors, buoyed by gains to Transurban (up 2.1 per cent), Qantas (up 1.9 per cent) and Cleanaway Waste Management (up 1.5 per cent).

Healthcare (up 1.1 per cent) was another strong performer, led higher by Resmed (up 2.2 per cent), Pro Medicus (up 2.6 per cent) and CSL (up 0.8 per cent). Real estate investment trusts Goodman Group (up 1.7 per cent), Scentre (1.2 per cent) and Stockland (up 1 per cent) were also in the green.

A rally in the banking sector was led by Commonwealth Bank (up 1.6 per cent) – the biggest stock on the ASX – and followed by NAB (up 1.5 per cent), ANZ (up 0.8 per cent) and Westpac (up 0.7 per cent). Macquarie rose 1 per cent, while insurers QBE (up 0.1 per cent) and Suncorp (up 0.4 per cent) also advanced.

Shares in Commonwealth Bank-backed real estate firm PEXA jumped 8.2 per cent after announcing the appointment of Russell Cohen as its new CEO on Tuesday morning. Cohen will take up the post on March 31.

Ventia shares gained 3 per cent, recouping some of their 9.2 per cent slump on Monday, triggered by the Australian Competition & Consumer Commission’s legal action against the infrastructure provider for alleged price-fixing announced late last week.

DigiCo Infrastructure REIT, which joined the ASX on Friday and caused some early disappointment, rose 7.2 per cent. HMC Capital, which has a 32 per cent stake in DigiCo, added 3 per cent.

Shares in synthetic graphite maker Novonix surged after it received a conditional $US755 million ($1.2 billion) loan from the US Department of Energy to build a manufacturing plant in Tennessee. Novonix rose as much as 16 per cent on the news before trimming its gains to 3.4 per cent.

The laggards

Mining giants BHP (down 0.3 per cent), Fortescue (down 0.4 per cent) and Rio Tinto (down 0.1 per cent) edged down, following softer iron ore prices as a disappointing economic stimulus and weaker-than-expected retail sales data from China sparked concerns about growth in the miners’ biggest export market.

Woodside Energy (down 1 per cent) and Santos (down 0.6 per cent) also declined, as did Whitehaven Coal (down 3.2 per cent), Meridian Energy (down 2.7 per cent) and APA (down 1.5 per cent).

Wealth manager Perpetual’s shares slipped 0.4 per cent after an independent expert ruled that a proposed deal to sell key parts of the company to KKR would not be in the best interests of shareholders following a shock tax ruling that Perpetual received last week.

The lowdown

IG market analyst Tony Sycamore said Tuesday’s market gains “came out of the blue” following five days of losses, adding that it appeared that the “Santa rally” – a period of rising stock prices in the week before Christmas Day – had started.

Sycamore said the sharemarket was “right in the seasonal sweet spot”, forecasting that the gains would continue into the first two weeks of January before tapering off before the inauguration of US president-elect Donald Trump on January 20.

On Wall Street overnight, the S&P 500 rose 0.4 per cent and the Nasdaq 100 gained 1.5 per cent to a new all-time high, with a widely expected quarter-point rate cut from the Federal Reserve on Wednesday seen as adding fresh support and extending stocks’ stellar run.

Bitcoin also hit a fresh record and topped $US107,000 ($168,036), according to CoinDesk, catapulting from roughly $US44,000 at the start of the year. For US investors, the main event this week will arrive on Wednesday when the Fed will announce its last move on interest rates for the year. The widespread expectation is that it will cut its main rate for a third straight time.

Tweet of the day

Quote of the day

“I thank Michael for his service to Westpac and wish him all the very best as he steps into the next chapter of his career.”

Westpac chief executive Anthony Miller announces the departure of chief financial officer Michael Rowland. It’s expected that Rowland will remain with Westpac until his successor is found.

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New ABC boss Hugh Marks says he didn’t know anything about the workplace issues at Nine Entertainment during his tenure as chief executive and is shocked by the alleged behaviour of some staff members.

Marks, who was announced as ABC’s managing director on Tuesday, ran ASX-listed Nine, owner of this masthead, between 2015 and 2021. He notably steered the company through the largest media merger of the past decade, bringing together Fairfax and Nine in a $4 billion deal.

with Bloomberg, AP

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