ASX up 0.7%: Will market sustain rally?

Summary

  • The S&P/ASX200 was trading higher by 55 points or 0.75% at 7,356 by Wednesday afternoon.
  • All sectors were trading in green, barring utilities and energy.
  • Australian resource company Iluka Resources was the top gainer, while tech firm Nuix emerged as the top loser.

Australian shares extended the day’s gain by afternoon, tracking overnight gains on Wall Street. The market witnessed broad-based buying, led by telecom and material stocks. However, persistent concerns over rising COVID-19 exposure sites and tighter curbs restricted market gains.

The S&P/ASX200 was trading higher by 55 points or 0.75% at 7,356 during the mid-market session. Early today, the index opened higher following strong cues from US markets. On Tuesday, Wall Street ended higher on economic optimism and signs that vaccines can counter a highly infectious coronavirus strain.

                     

The Mid Market Pulse || ASX Up 0.7%: Will Market Sustain Rally?

 

On the sectoral front, nine of the 11 sectoral indices were trading in green. The telecom sector was the top performer with 2.8% gain. Among others, materials, financial, industrials, and consumer discretionary also witnessed a surge in buying.  

On the flip side, utilities sector was the worst performer, falling over 1%, followed by energy, which was trading 0.75% lower.

Top gainers and Losers

Australian resource company Iluka Resources Limited (ASX:ILU) was the top percentage gainer on the ASX, rising 9.5% to AU$8.97. Some of the other notable gainers were Clinuvel Pharmaceuticals Ltd. (ASX:CUV), Chalice Mining Ltd (ASX:CHN), Telstra Corporation Limited (ASX:TLS) and Nearmap Ltd. (ASX:NEA).

On the other hand, technology company Nuix Limited (ASX:NXL) was the top laggard with 14% loss. AGL Energy Limited (ASX:AGL), Collins Foods Limited (ASX:CKF), Kogan.com Ltd. (ASX:KGN) and Origin Energy Ltd (ASX:ORG) were among top losers.

Shares in News

Shares of Link Administration Holdings Limited (ASX: LNK) gained 1.4% to AU$5.1 after the admin services provider announced the plans to retain a slightly smaller shareholding in the property settlements platform, PEXA. The shares of PEXA are set to list on the ASX on July 1. In an exchange filing, Link, the largest shareholder in PEXA, said it would hold a 42.8% stake in the digital property settlement platform after the IPO. The company will also receive cash proceeds around worth AU$180 million, which will be used to pare debts to make balance sheet stronger and more flexible.

Shares of Telstra Corporation Limited (ASX:TLS) rose 4% to AU$3.74 after the telecommunications giant announced that it would sell nearly half of its mobile tower business for AU$2.8 billion. A consortium comprising the Future Fund, Commonwealth Superannuation Corporation and Sunsuper will acquire a 49% stake in Telstra InfraCo Towers, Australia’s largest mobile tower infrastructure provider. The transaction values Telstra InfraCo Towers at AU$5.9 billion.

The share price of AGL Energy (ASX:AGL) dropped 4% to AU$8.74 after the company unveiled its demerger plan. AGL Energy will be renamed Accel Energy and demerge its retailing business, AGL Australia, into a separate entity.

Australian technology company Calix Limited’s (ASX:CXL) shares rose 3.5% to AU$2.6 on securing funds for its new Biotech facilities. The company has been awarded a maximum AU$1-million grant under the Australian Government’s Manufacturing Modernisation Fund (MMF) to develop and transform its Biotech manufacturing capability at its Bacchus Marsh facility in Victoria.

Australian clinical-stage drug development firm Noxopharm (ASX:NOX) has shared that the European Patent Office (EPO) had issued a formal notice of allowance of claims for the company’s patent application, indicating an intention to move to patent grant. The patent relates to the therapeutic use of idronoxil in a suppository dosage formulation intended to provide a steady-state blood level of the drug. Following the announcement, shares of Noxopharm were trading 0.8% lower at 63.5 Australian cents.

Shares of pharma company Paradigm Biopharmaceuticals (ASX:PAR) rallied nearly 6% to AU$2.05 after the company said that it had responded to US Food and Drug Administration’s (FDA) questions on its Investigational New Drug (IND) application.The FDA is now expected to review the company’s responses and revert over the next statutory 30-day period. 

The share price of Sayona Mining Limited (ASX:SYA) zoomed 15% to 8.5 cents after the lithium producer gets court approval for North American Lithium (NAL) acquisition. The company said it had achieved a major milestone in its Québec expansion, following court approval for its joint bid with Piedmont Lithium for NAL.

The share price of AML3D Limited (ASX:AL3) surged 25% to 22.5 cents after the company announced that it had received a purchase contract from the Boeing Company for 3D printing, a tooling component. The company has received a purchase contract from Boeing to supply an Invar-361 ‘mandrel tool artifact’, using AL3’s proprietary Wire Additive Manufacturing (WAM) process.

Shares of Strategic Elements Ltd (ASX:SOR) rose 13.5% to 25 cents after the company released a business update. The company has reached a crucial development milestone with its moisture-powered battery successfully powering an IoT device outfitted with both temperature and humidity sensors and onboard Bluetooth communication.

Asian Markets Edge Higher in Opening Trade

Asian markets started the day on a positive note as easing coronavirus cases in the Asia-Pacific region and firm global cues lifted market sentiment. 

Japan's Nikkei rose 0.1%, while China’s Shanghai Composite was down 0.06%.

Taiwan’s Weighted Index surged 0.7%, Seoul's KOSPI gained 0.4% and Hong Kong’s Hang Seng rose 0.3%.

In a similar trend, New Zealand’s benchmark S&P/NZX 50 was trading 0.2% higher. 

In overnight trade, US stocks ended higher, with the S&P 500 marking a record high for the fourth consecutive session, supported by technology and banking shares. The rally was also buoyed by a government survey that revealed US consumer confidence in June 2021 hit its highest since the onset of the coronavirus pandemic. On Wall Street, the Dow Jones closed 0.03% higher, the S&P 500 also gained 0.03%. The NASDAQ Composite added 0.19%.

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