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Australian shares kicked off the week on a strong note, driven by a rally on Wall Street as technology and gold stocks showed impressive gains. The S&P/ASX 200 Index (ASX:XJO) climbed by 0.5%, or 37.6 points, to reach 8,137.5 points. This performance brings the ASX 200 within just 11 points of its record high of 8,148.7 points, achieved in August. The index's upward trajectory has been notable, with a gain of over 1% in the previous week.
The rally in Australian stocks reflects the broader global market trends, particularly the positive momentum from the US. On Friday, US stocks surged, fueled by growing expectations of a reduction in interest rates by the Federal Reserve. Market speculation now suggests a near-even chance that the Fed may opt for a substantial 0.50% rate cut, a move that could further invigorate global financial markets and impact investment strategies worldwide.
In the Australian market, gold miners were among the standout performers. The price of gold reached new highs, which significantly boosted the performance of gold mining stocks on the ASX. Evolution Mining Ltd (ASX:EVN) led the sector with a notable 4% increase in its share price. West African Resources Ltd (ASX:WAF) also experienced a strong rise, with its shares up by 3.3%. Emerald Resources Ltd (ASX:EMR) saw a more modest increase of 0.9%. This gain came after the company reassured investors that a recent incident involving a wall slip at its Cambodian mine would not derail its production guidance for the year.
In addition to the gold sector, blue-chip stocks also saw positive movements. Iron ore giants BHP Group Ltd (ASX:BHP) and Rio Tinto Ltd (ASX:RIO) experienced slight increases in their share prices. The major banks also saw gains, with the exception of ANZ Banking Group Ltd (ASX:ANZ), which saw a minor decline at the market open.
Several notable stocks saw significant movements:
- Cettire Ltd (ASX:CTT): The online retailer experienced a 6% drop in its share price following a report suggesting potential changes to duties thresholds by the US White House. This development has created some uncertainty around the company's future performance.
- Alcoa Corp (ASX:AWC): The mining company surged nearly 6% after announcing it would sell its full joint venture interest to Saudi Arabian Mining Company (Ma’aden) for $1.1 billion (US$1.6 billion). This sale is expected to streamline Alcoa's operations and focus on its core activities.
- Austal Ltd (ASX:ASB): The defence shipbuilder saw a substantial 5.8% increase in its share price. This rise follows the announcement of a $450 million (US$450 million) contract with General Dynamics Electric Boat to expand production capacity at its US shipyard in Mobile, Alabama. This contract is a significant boost for Austal and highlights its growing role in the defence sector.
- Lendlease Group (ASX:LLC): The property giant rose by 0.5% after finalizing the sale of its US East Coast construction operations to Consigli Building Group. This strategic move is expected to enhance Lendlease's focus on its core markets and operations.
On the downside, Qube Holdings Ltd (ASX:QUB) and Chorus Ltd (ASX:CNU) both fell as they traded ex-dividend, reflecting the typical adjustment in share prices when dividends are paid out.
Additionally, Auckland Airport Ltd (ASX:AIA) is currently in a trading halt. The company has launched a substantial $NZ1.4 billion ($1.3 billion) equity raise aimed at funding its capital investment program and reducing its debt. This move is expected to have significant implications for the company's financial strategy and future growth plans.
The ASX is on a strong trajectory towards achieving new heights, supported by positive global economic indicators and robust sector performances.
