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Highlights
- ASX 200 rose 0.9% to finish the week 0.8% higher buoyed by Technology and Material stocks
- The ASX 200 index opened on a positive note, rising over 1% in opening trade, but as trade progressed, gains faded
- Investors remain cautious ahead of next week's crucial RBA interest rate decision
Australian equities ended higher on Friday as export-focused miners gained tracking overnight surge in commodity prices while the Tech sector followed its U.S. counterparts, which registered strong gains on Wall Street.
The S&P/ASX 200 index ended 0.88% or 62.90 points higher at 7,238.80, to mark a third straight weekly gains. Including today's gains, the benchmark rose 0.8% this week.
The ASX 200 index opened on a positive note, rising over 1% in opening trade, but as trade progressed, gains faded as investors pocketed some of the recent gains ahead of next week's crucial RBA interest rate decision. While the consensus estimate is that the central bank will raise rates by 25 basis points to 0.60%, some of the experts are also pricing in a 40 basis points hike in key interest rates to 0.75%.
How were the sectors and indices placed?
Except for Consumer Discretionary, all other sectors on the ASX closed with gains today. Materials sector was the best performer, rising 2.62% followed by Information Technology and Energy, which rose 2.26% and 1.04% respectively.
Volatility indicator- A-VIX index however, slipped down over 5%. The All-Ordinaries index strengthened slightly while large cap index ASX50 (XFL) rose 0.691%. Meanwhile, the Midcap index ASX Midcap 50 (XMD) gained 1.793% and the ASX Small Ordinaries index (XSO) took a lead of 1.411%
Top gainers and losers on Friday
Image Source © 2022 Kalkine Media ®, data source- ASX website
Champion Iron (ASX:CIA) was the top gainer on the ASX 200 index, rising 8.14%. Following lead were Pilbara Minerals (ASX:PLS) and Gold Road Resources (ASX:GOR), which are also from the Materials sector. On the flipside, Healius Limited (ASX:HLS) from the healthcare sector lost 8.65% to become the top loser on the benchmark index. The company had flagged a difficult second half of its financial year. The consumer discretionary sector was the only index category to post a loss, albeit small. From the Consumer stocks, Domino’s Pizza (ASX:DMP) lost 3.69% to be among the top five losers in the benchmark index.
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Newsmakers of the day
- Champion Iron, BHP Group, Rio Tinto and Fortescue Metals were the top gainers in the mining pack, supported by overnight gains in base metal prices as China reopening boosted demand outlook.
- Lithium stocks also extended gains; Pilbara Minerals, Liontown Resources ended higher today.
- The Australian technology stocks traced a strong rally in Nasdaq overnight. As a result, Life360, Tyro Payments and Block Inc. shares closed the week higher.
- From financials that gained the least, CBA and NAB edged lower, while ANZ and Westpac went up slightly.
On the global front
Asian markets followed strong cues from the US indices that closed higher last night. While the Chinese indices CSI300 and Hang Seng were unchanged on account of a market shutdown, stocks on Japan’s Nikkei and South Korea’s KOSPI ended higher.
Globally, investors remain fearful on the pace of US monetary tightening, which is anticipated to take the world’s largest economy on a recession. Key events on Investor’s radar in the remaining days of the week are the US May employment report due today and the UN’s Food and Agriculture Organization’s monthly food price index.
On the commodities front
Oil prices remained noteworthy on Friday as markets shrugged off the decision of OPEC+ to hike oil production. Investors were still questioning if the incremental output could suffice for lost Russia output to meet China's splurging intake as lockdowns ease. Both globally observed benchmarks for the black liquid WTI and Brent crude futures edged lower.
Also Read- Will Australia be able to solve gas supply shortage problem anytime soon?
