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Highlights
- ASX starts the week higher amid global trade developments
- Temporary US tariff exemptions lift sentiment
- Materials and gold sectors lead early gains
The Australian share market opened the week in positive territory, buoyed by encouraging developments on the global trade front. The S&P/ASX 200 index climbed 53.9 points, or 0.7%, to 7,700.4 by 10:30am AEST on Monday, offering a temporary reprieve after a volatile start to the year. While the index is still down 5.62% year-to-date, it has recovered 0.43% over the past five sessions.
Recent reports that several nations are expediting trade agreements with the United States provided some confidence to investors. Over the weekend, news emerged that certain electronic products, including smartphones and computers imported from China into the US, will remain temporarily exempt from tariffs imposed by the US administration. This move helped improve market sentiment and offered a brief pause in the escalating trade tensions between the world’s two largest economies.
Despite this temporary relief, concerns remain high. ANZ economist Aaron Luk noted that tariff rates between the US and China have reached "prohibitively high" levels. Chinese officials have indicated that further increases in US tariffs will be disregarded, pointing to a possible stalemate rather than resolution.
Nevertheless, the tariff exemptions have been perceived as a step toward de-escalation, even if only short-lived. The administration has clarified that these exemptions are temporary, so any lasting market impact will depend on future policy decisions.
Materials led the charge on the ASX this morning, rising 1.25%, while the energy sector gained 0.23%, utilities were up 0.22%, and industrials edged 0.16% higher. Among the standout performers, Mineral Resources (ASX:MIN) advanced 5.4% to $17.57, benefiting from renewed optimism in the resource sector.
The gold sector continued to shine as economic uncertainty and recession fears pushed investors toward safehaven assets. Gold surged 6.6% last week, closing above US$3,200 an ounce. Newmont Corporation (ASX:NEM) rose 4.69% to $87.22, while Ramelius Resources (ASX:RMS) gained 4.14% to $2.77 in early trade.
Copper also rebounded, trading above US$10,000 a tonne on expectations of additional economic stimulus from Chinese policymakers. Discussions reportedly centered on support for housing, consumption, and technological innovation to mitigate the effects of the tariff environment.
The broader index, the S&P/ASX 200, represents around 80% of Australia’s listed equities by market capitalisation and reflects the performance of the top 200 listed companies, making it a key benchmark for the Australian market.
