Have the ASX bulls found a new home from the eight-year lows?

March 24, 2020 - 1 week ago
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It was a brighter start for the ASX 200 after yesterday’s fall, the battered and bruised index closed at its lowest level since late November 2012 at 4,402.5.

With the help of the U.S. Federal Reserve announcement overnight that it would take additional aggressive action, including buying an unlimited amount of Treasury bonds, the Australian share market has managed to hold to a decisive run on Tuesday and sustained the rebound from the near eight-year lows as gains in the Gold, Energy and A-REITs sectors led the index higher.

The benchmark S&P/ASX 200 rallied +122 points in the final half-hour of trade to close the Tuesday session up +189.7 points, or +4.17%, at 4,735.7, while the All Ordinaries index climbed +189.2 points, or +4.15%, to 4,753.3.

The gold miner’s shares were mixed considering spot gold significant rally in the last 48 hours has now posted an intraday high of $US1,612 an ounce (after the daily session close).

Newcrest Mining rose +6.5% to $24.21, while Gold Road Resources jumped +17.37% to $1.25 and Northern Star Resources gained +18.32% to $12.98.

In the mining sector, BHP shares closed +4.74% higher at $28.31, while Rio Tinto rose +1.07% to $79.55 after announcing it would slow operations in Canada and halt some in South Africa because of coronavirus shutdowns. Fortescue Metals Group managed a +1.88% gain to end the day at $9.73.

The “Fab Four” (banks) were also up, with CBA gaining +5.05% to $57.00, with NAB rising +3.75% to $14.40, ANZ gained +5.32% to $14.85, and Westpac was up +2.91% to $14.51.

Energy gained the most, +7.63%, as the price of West Texas Intermediate (WTI) surged 15% overnight.

Santos surged +18.84% to $3.47, with Woodside climbed +5.96% to $16.18 and Oil Search gained +6.88% to $2.02 and Caltex recovered +7.95% to $20.51.

Real estate was the second-biggest gainer, rising +7.53% as Goodman Group climbed +3.54%, Dexus rose +4.73%, and Stockland gained 3.85%.

The significant gains were posted by Afterpay, which surged +25.96% to $11.21, WiseTech Global, which advanced +13.9% to $13.67, and Xero rose +7.4% to $63.09.

As for the discretionary stocks, who were yesterday’s anchors, Aristocrat Leisure gained +8.20% to $16.89, Tabcorp +6.82% to $2.35 and Crown rose +5.23% to $6.44.

Woolworths slipped -0.74% to $36.18 after it said venue closures, and changes to shopping behaviour at its supermarkets, meant it could not estimate the impact of the virus on its full-year financial results, while Wesfarmers rose +2.13% to $31.68.

Consumer debt company Credit Corp Group soured +45.92% to $9.12, although that still leaves it down -70% on the year.

Seven West Media gained +1.52% to +0.067 after it said the postponing of the Olympics and AFL competition, along with a falling advertising market, means it must scrap its earnings guidance.

Michael Hill Jeweller plummeted -14.55% to $0.235 after it postponed its interim dividend payment of 1.5 cents per share for six months.

Retail Food Group fell -8.57% to $0.032 after the company, which runs Gloria Jeans cafes, Donut King, Crust pizza outlets, scrapped its guidance but noted good sales at some stores.

Meanwhile, the Australian Dollar, our local currency is currently buying US$0.5915 (as of writing).

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