Aust stocks rise for second day after US relief rally

Derek Rose | August 29, 2023

The local share market is on the rise for a second day as risk-off sentiment continues to abate in the wake of a weekend US summit of central bankers.

At noon AEST on Tuesday, the benchmark S&P/ASX200 index was up 25.7 points, or 0.36 per cent, to 7,185.5, while the broader All Ordinaries had gained 23.2 points, or 0.31 per cent, to 7,389.1.

The gains came after a positive lead on Wall Street, where the S&P500 jumped 0.6 per cent in a relief rally following the Jackson Hole Symposium in Wyoming, where Fed chairman Jerome Powell reiterated that interest rates might possibly rise again to combat inflation.

St George senior economist Jarek Kowcza said markets were now pricing in a 70 per cent chance of another Federal Reserve hike this cycle – most likely in November – up from a 50 per cent chance before the Jackson Hole event.

Closer to home, traders will also be scrutinising a speech on Tuesday night by incoming Reserve Bank governor Michele Bullock on central banks and inflation for clues on her thoughts on rate hikes.

Eight of the ASX’s 11 sectors were in the green at midday, with energy basically flat and health care and tech both down 0.7 per cent.

Mining and consumer discretionary shares were the biggest collective gainers, both up 1.0 per cent.

BHP was up 0.7 per cent to $43.86, Fortescue had gained 1.3 per cent to $20.12 and Rio Tinto had advanced 1.1 per cent to $109.85.

Wesfarmers was up for a fifth straight day, rising 2.3 per cent to a year-and-a-half high of $53.29 following enthusiasm over the Kmart and Bunnings’ owners earnings report last week.

Two of the Big Four retail banks were in the green: Westpac was up 0.6 per cent and ANZ up 0.5 per cent. NAB was basically flat and CBA was down 0.1 per cent.

Tyro Payments had soared 13.6 per cent to a three-week high of $1.2775 after the Eftpos machine provider posted its first year of positive cash flow since listing on the ASX in December 2019, with $5.7 million generated.

Star Entertainment Group was up 4.0 per cent to 98.25c after the troubled casino operator posted a $2.44 billion loss after writing down the value of its Sydney, Brisbane and Gold Coast casinos by more than $2 billion.

Chief executive Robbie Cooke said consequences flowing from the damage to the group’s social licence were felt daily by team members on multiple levels.

The Australian dollar was buying 64.40 US cents, from 64.09 US cents on Monday.