- Updated
- Business
- Markets
- World markets
ASX extends gains as investors await key Fed meeting
By Millie Muroi and Sumeyya Ilanbey
Welcome to your five-minute recap of the trading day.
The numbers
The Australian sharemarket extended its gains on Tuesday as investors marked time ahead of the US Federal Reserve’s key interest rate meeting later this week.
Wall Street has made a strong start to its week.Credit: Reuters
The S&P/ASX 200 Index rose 26.7 points, or 0.35 per cent, to 7664.1 at the close, with eight out of the 11 major sectors higher.
The lifters
Real estate investment trusts and consumer discretionary stocks both lifted 0.79 per cent to become the best-performing sectors on the ASX.
Miners IGO (up 7.3 per cent), Pilbara Minerals (up 2.5 per cent), South32 (up 2.3 per cent) and Lynas Rare Earths (up 2 per cent) were among the biggest large-cap advancers.
Shares in internet service and mobile phone provider TPG continued to rise on the back of a landmark agreement Monday with telco Optus to triple the company’s national 4G and 5G coverage. They closed 3.4 per cent higher, taking their two-day gains to 8.7 per cent
The laggards
The industrial sector was the biggest loser, dipping 0.53 per cent, heavily weighed down by Worley, which saw its shares plunge 7.5 per cent.
Investors headed for the exits after one of Worley’s major shareholders, Dubai-based infrastructure group Sidara, sold a $1.4 billion, 19 per cent stake in the company for $14.35 a share – a 12 per cent discount to Monday’s closing price.
Worley shares had surged more than 13 per cent since February 1.
Ampol (down 3.3 per cent) and Telix Pharmaceuticals (down 3 per cent) were also among the biggest large-cap decliners.
The lowdown
The US Federal Reserve will meet on Wednesday (Thursday AEST), with global investors looking for clues on the path of US interest rates. The markets have priced in just 35 basis points of rate cuts in 2024 – down from expectations of 150 basis points at the start of the year.
Positive economic news that Australian retail sales fell 0.4 per cent in March as households continued trimming their budgets also supported the sharemarket.
“Following last week’s consumer price index surprise, the miss in retail sales feeds the argument against future rate rises, which future markets ascribe a 20 per cent chance,” Capital senior financial market analyst Kyle Rodda said in a research note to investors.
“Arguably, stubborn inflation, caused in part by stronger demand driven by migration, coupled with clear signs of a weaker household sector, paints the RBA into a corner, as it faces the invidious prospect of tackling sticky prices at a time of slowing economic activity.”
On Wall Street overnight, US stocks ticked higher to begin a week packed with potentially market-moving economic reports.
The S&P 500 Index rose 0.3 per cent, coming off its best week since November. The Dow Jones Industrial Average added 0.4 per cent, and the Nasdaq Composite Index gained 0.3 per cent.
In the bond market, the yield on the 10-year Treasury slipped to 4.62 per cent, from 4.67 per cent late Friday.
Tweet of the day
Quote of the day
“Bonza has temporarily suspended services due to be operated today [Tuesday] as discussions are under way regarding the ongoing viability of the business,” Bonza chief executive Tim Jordan said as the company entered into voluntary administration. “We apologise to customers who are impacted by this, and we’re working as quickly as possible to determine a way forward that ensures there is ongoing competition in the Australian domestic aviation market.”
You may have missed
One of Australia’s largest shopping mall owners significantly downgraded security management at its 57 major centres around the country in the month before the deadly Westfield Bondi Junction attack, potentially compromising its ability to respond to major emergencies or crises.
The Market Recap newsletter is a wrap of the day’s trading. Get it each weekday afternoon.