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Highlights
- ASX 200 finished today’s session 0.3% higher at 7112.5 points, buoyed by a rally across resources stocks.
- Australian share market might remain volatile amidst rising recession risks and commodity price variations.
- Economic growth fears in the world's two largest economies have re-emerged after weak retail sales and factory production figures in China and disappointing US manufacturing data.
- Investors are also weighing the global inflationary impact of lockdowns in China.
Amid economic fluctuations and geopolitical worries, sinusoidal trends have continued across global share markets in the past few months.
So far this year, recession warnings have been bubbling amid the war in Ukraine, coronavirus lockdowns in China and a more aggressive Federal Reserve. Even though signs of weakening economies seem everywhere, sniffing out evidence that outright recession is on its way is still tough.
Today back home in Australia, the Reserve Bank of Australia’s (RBA) revealed that it has decided to increase interest rates by a surprising quarter of a percentage point. This move would help signal the board was now returning to normal operating procedures after the extraordinary period of the pandemic. Now, it is to be seen if the RBA will further lift interest rates in quarter-percentage-point increments.
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How did ASX 200 perform?
In the opening minutes of trade, the ASX 200 added 0.2%, or 16.4 points, to 7109.4 buoyed by gains across the materials and energy sectors. Miners benefited from the rising iron ore price and the energy sector advanced on the back of climbing oil prices. Losses posted by technology and healthcare stocks were offset by these impressive gains.
Eventually, the benchmark index finished today’s session gaining 19.50 points or 0.27% to 7,112.50, buoyed by a rally across resources stocks. Over the last five days, the index has gained 0.87%, but is down 4.46% for the last year to date.
On the sectoral front, more sectors ended lower than higher. Energy was the best performing sector, gaining +2.02% and +2.45% for the past five days.
How Will Soaring Energy Prices Affect Mining Industry?
Who gained? Who lost?
The top performer today was Lynas Rare Earths (ASX:LYC), up 6.5%. It was followed by Beach Energy (ASX:BPT), thanks to another jump in oil prices that boosted the energy sector today. Other gainers of the day were Whitehaven Coal (ASX:WHC), Mineral Resources (ASX:MIN) and Allkem Limited (ASX:AKE).
On the other side, in the red zone of the ASX 200, Brambles Limited (ASX:BXB), was the top laggard, down over 7%. Yesterday, the Company affirmed talks about a potential bid by CVC Capital.
Other stocks in this zone were Pointsbet Holdings (ASX:PBH), REA Group (ASX:REA) Magellan Financial Group (ASX:MFG) and Seek Limited (ASX:SEK).
Asian and global market
Asian shares edged higher today despite fears that global economic recovery may be more fragile than expected, even as inflationary pressures remain high. A jump in some technology firms and China’s efforts to stamp out a Covid outbreak seem to have propelled investing sentiment today.
MSCI's broadest index of Asia-Pacific shares outside Japan gained 0.84%. In Tokyo, the Nikkei was flat in early trade. Hong Kong's Hang Seng Index was 1.2% higher and mainland China's CSI300 Index gained 0.07%.
Overnight on Wall Street, shares closed mostly lower. The Dow held on to a modest gain. Seven of the S&P 500’s 11 industry sectors closed down, led by consumer discretionary’ s 2.1% retreat.
