ASX 200 recovers nearly 1% after a strong Wall Street closing

Summary

  • On Wednesday, the ASX 200 traded higher by 0.97% or 70.1 points in the opening trade, at 7,322.3.
  • All three indices on Wall Street were up over 1.5% each.
  • The A-VIX has retreated 8.3% from yesterday’s close, to 12.06, denoting a decreasing volatility.

Wall Street’s rebound has helped the Australian market pare some of its losses made in the last two sessions, when the benchmark hit a new 20-day low. On Wednesday, the ASX 200 traded higher by 0.97% or 70.1 points in the opening trade, at 7,322.3.

Image Source: Copyright © 2021 Kalkine Media

Wall Street ended Tuesday’s session with a sharp recovery, bouncing off from a multi-day losing streak.  Upbeat earnings reports coupled with revived economic optimism improved investors’ confidence and fuelled a risk-on rally.

All three indices on Wall Street were up over 1.5% each. The Dow Jones recovered 1.62% to 34,512, while the S&P 500 was up 1.52% at 4,323.05. The tech-heavy NASDAQ Composite gained 1.57% and closed the session at 14,498.88.

Read More: Will US stock rebound guide ASX 200 to trade in green today?

How has the market performed so far?

At 10:30 AM, the Australian benchmark index, ASX 200, is trading 1.12% up, at 7332.6. The market has shown a one-sided rally so far, comfortably crossing yesterday’s high in a jiffy. The All Ordinaries Index is also up by 1.09% at 7.607.05.

Subdued investors’ fears have also reflected on the A-VIX, which has retreated 8.3% from yesterday’s close, to 12.06, denoting a decreasing volatility.

Data Source: ASX Website (as of 21 July 2021, at 10:30 AM AEST)

The market breadth has also been on the positive side. A total of 9 out of the 11 sectors are trading in the green, with Materials and Utilities leading the pack, gaining 0.82% and 0.7%, respectively. Among the top ASX 200 gainers are – Univail-Rodamco-Westfield Limited (ASX:URW) and Lynas Rare Earths Limited (ASX:LYC) , gaining 3.53% and 3.49%, respectively.

In today’s positive session, a few stocks trying to cap index gains are Altium Limited (ASX:ALU) and Evolution Mining Limited (ASX:EVN), losing 3.73% and 1.91%, respectively.     

Read More: Is there a crypto ETF in Australia?

Newsmakers

L1 Long Short Fund Limited (ASX:LSF) registered an 8.8 per cent increase over the quarter, against the benchmark's 8.3 per cent gain, extending its one-year return at the portfolio level to 72.9 per cent, massively outperforming the market's 27.8 per cent.

Service Stream Limited (ASX:SSM) shares have voluntarily entered a trading halt, ahead of an announcement regarding capital raising via a placement to institutional investors. The company has acquired Lendlease Services Limited (ASX:LLC) for AU$310 million, for which it is raising AU$185 million.

Image Source: Copyright © 2021 Kalkine Media

Whispir Limited (ASX:WSP) boosted its annual recurring revenue (ARR) to AU$53.6 million, as of 30 June 2021. However, the company incurred an operating loss of AU$3.3 million in FY21, clocking sales worth AU$46.2 million.

Beach Energy Limited’s (ASX:BPT) revenue, for the quarter ended 30 June 2021, rose 7% to AU$421 million, as the company benefitted from a 10% increase in the realised oil prices.

CIMIC Group Limited (ASX:CIM) revenue climbed 10.6 per cent to AU$7.1 billion, but its net profit saw a decline to AU$208 million, from AU$317 million a year ago. The group has maintained its FY21 profit guidance after reporting strong group revenue growth in 1HFY21.

e-commerce giant Kogan.com Limited's (ASX:KGN) sales recovered in June 2021, over April and May 2021. The company reported a 23% growth in adjusted EBITDA over the last year, while the revenue was up by 56%.

South32 Limited (ASX:S32) has reported a record annual production, with several of its projects beating the company’s guidance as well. Zinc production at Cannington increased by 14 per cent on a YoY basis, while South Africa Manganese ratcheted up its production by 21 per cent from the previous year. The company also expects to report pre-tax impairment in its FY21 results of AU$993 million for its Illawarra Metallurgical Coal business. 

Gold miner, Perseue Mining Limited (ASX:PRU) has beaten it production guidance by reporting 191,246 ounces of gold production for 1H FY21, compared to the guidance of 175,000 to 190,000 ounces of gold.

The world’s biggest miner, BHP Group Limited (ASX:BHP), is reviewing its petroleum business and considering options to exit its oil and gas business in a move that would accelerate its retreat from fossil fuels.

Read More: Five trending Australian shares in the retail space

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