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Highlights
- ASX nears record highs, fueled by gains in tech and financial stocks.
- Arcadium Lithium surges 46% following takeover talks with Rio Tinto.
- Mining and energy sectors see mixed performance as global commodity prices shift.
Australian shares closed just shy of a record high, buoyed by a rally on Wall Street following strong US labor data. The S&P/ASX 200 index gained 55.4 points, or 0.7%, to close at 8205.4, just 7 points below its all-time high of 8212.2, set in September. The day's trading was lighter due to the Labour Day holiday, but momentum remained strong, snapping a three-week losing streak.
Key Performers: Financials and Tech Lead the Charge
Of the 11 sectors in the index, seven posted gains, with the tech and financial sectors leading the way. Notable among the financial stocks, National Australia Bank rose by 1.9% to $37.12, Westpac advanced 2.2% to $30.78, and Commonwealth Bank increased 1.5% to $134.77. These gains contributed significantly to the market’s overall positive movement.
Arcadium Lithium Surges on Takeover News
Arcadium Lithium emerged as the standout performer, surging 46% to $6.09 after Rio Tinto confirmed discussions for a potential takeover. This marked Arcadium's largest one-day gain since its creation in January through a merger between Allkem and US-based Livent. However, Rio Tinto saw its shares drop by 2.5% to $121.17.
The news lifted sentiment across the lithium sector, with companies like Liontown Resources jumping 18% to 88¢, Sayona Mining rising 12% to 3.5¢, and Core Lithium increasing by more than 8% to 12.5¢. Speculative investors, who had taken short positions as lithium prices dropped, were forced to readjust as the sector rallied.
Mixed Performance in Energy and Mining
Energy stocks experienced a more uneven session, with oil prices fluctuating due to concerns over potential disruptions in oil supply stemming from geopolitical tensions in the Middle East. Beach Energy gained 0.8% to $1.28, while Santos slipped slightly by 0.1% to $7.29, and Woodside Petroleum closed 0.2% higher at $26.68.
In the broader mining sector, heavyweights BHP and Fortescue Metals posted gains. BHP rose 0.6% to $44.86, while Fortescue surged 3% to $20.35, supported by rising iron ore prices. Speculation about new stimulus measures from China also boosted optimism in the sector, with the November futures contract in Singapore climbing 1.7%, reclaiming the $US110 mark.
Corporate News
West African Resources experienced a significant decline, falling nearly 20% despite reaffirming its operational guidance and emphasizing the support of the Burkina Faso government for its gold mining operations. This made it the biggest laggard in the index for the day.
The market's near-record close highlights the resilience of Australia's financial and mining sectors, even as global uncertainties continue to influence commodity prices and investor sentiment.
