AUS
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Highlights
- ASX 200 sees a strong rally, gaining 1.4% to close at 8,327.
- Big banks and tech stocks show solid performance following positive US inflation data.
- Zip Co (ASX:Z1P) surges 10% on strong performance from a US rival.
The Australian share market experienced a notable boost on Thursday, driven by a favourable US inflation report that alleviated concerns about the US economy needing further interest rate hikes. The benchmark S&P/ASX 200 Index surged by 113.7 points, marking a 1.4% rise to close at 8,327. Meanwhile, the All Ordinaries finished 1.3% higher.
Investor sentiment was strongly influenced by Wall Street’s rally, bolstered by solid earnings from major US banks. This uplift was further compounded by the release of a soft US consumer price index (Core CPI) report showing just a 0.2% increase, easing inflation worries and reducing the chances of tighter monetary policies in the US.
Jeff Schulze, Head of Economics and Market Strategy at ClearBridge Investments, pointed out that the report helped ease concerns over rising inflation, as the numbers contradicted fears that robust economic data and a hot US jobs report would reignite inflationary pressures.
Locally, Australia's banking sector was a major contributor to the day’s gains. The country's four major banks rallied more than 2%. Leading the way, Commonwealth Bank (ASX:CBA) climbed 3%, closing at $155.75, while investment bank Macquarie Group (ASX:MQG) gained 3.2% to $231.34.
Equity markets also saw a boost in the technology and real estate sectors, as both performed well in response to the US inflation data. WiseTech (ASX:WTC) was up by 2.6%, regaining losses from the prior day, while Xero (ASX:XRO) saw a 1.5% rise to $168. Real estate stocks continued their positive momentum, with Goodman Group (ASX:GMG) up by 3.2% to $37.69, and Mirvac (ASX:MGR) also surged 3.1%, closing at $1.945.
Adding further excitement to the market were positive local employment figures. Australia saw a strong jobs report with employment increasing by 56,300 in December, far surpassing the expected 15,000. The unemployment rate increased slightly to 4%, maintaining alignment with general expectations and tempering investor expectations of a rate cut in Australia.
In stock-specific news, Zip Co (ASX:Z1P) saw a remarkable 10% jump to $3.09, following an upbeat revenue forecast from its US counterpart, Sezzle, which cited exceptional holiday demand. Tabcorp Holdings (ASX:TAH) also witnessed gains, climbing 5.9% to 62.5¢ after naming Michael Fitzsimons as its Chief Wagering Officer. Finally, MLG Oz (ASX:MLG) surged 8.8% to 62¢, boosted by Northern Star Resources’ contract for mining services.
The optimism surrounding local stocks was reflected in strong market performance across various sectors, as investors welcomed positive data both domestically and abroad.
