An uplift in global investor sentiment saw tech stocks rebound, leading the Australian sharemarket to another strong day after a voter-friendly federal budget was handed down.
Investors on the eve of the quarter’s end appeared buoyed with the index on track to finish March at least 6 per cent higher in what could be its largest one month gain since the US presidential election in November 2020.
The benchmark ASX 200 index gained 50.20 points, or 0.67 per cent on Wednesday, to finish the session at 7514.5 points.
The broader All Ordinaries rose by 52.90 points, or 0.68 per cent, to close at 7799.9 points, while the Australian dollar continued to hover around 75 US cents.
Materials had a rare off-day but nine of 11 sectors closed in the green, led by tech shares which secured a 3.84 per cent overall rise during their bumper session.
City Index analyst Tony Sycamore was optimistic the market would continue its dream run, with April statistically the index’s second strongest month of the year.
“With the local market in beast mode, it would be a brave trader to stand in the way of a move towards 7700 in the weeks ahead,” he said.
Shifting international sentiment helped the market to rally more broadly as investors were tempted once again by riskier stocks after a few months in which the Australian index had outperformed other countries off the back of commodity prices.
Investors globally appeared to be more confident about prospective peace talks between Ukraine and Russia despite scepticism about the latter’s pledge to reduce some military combat operations around Kyiv.
After passing 30 with the Russian invasion, the US Volatility Index is back down to around 18, which IG Markets analyst Kyle Rodda said was a typical level historically conducive to risk tasking and investors moving back intxjmtzywo equities.
“It’s basically broad based; you’re probably seeing a greater playback in European equities. I guess the only thing we saw today was the Nikkei underperform but that was an outlier,” he said.
Mr Rodda said the recovery in the tech space was also helped by reduced concerns about inflationary prices after a drop in oil prices.
Life 360 led the sector and was the best performer on the index, adding 9.63 per cent to $5.92. Afterpay owner Block rose by 6.12 per cent to $194.36, while Xero gained 5.28 per cent to $107.66 and Megaport added 6.97 per cent to $14.12.
Retailers were strong after the release of the federal government’s cash splashing pre-election budget despite dwindling consumer confidence amid rising commodity prices and cost of living concerns.
Kogan.com added 5 per cent to $5.88, Nick Scali rose 2.17 per cent to $11.77, Harvey Norman was up by 1.78 per cent to $5.71 and JB Hi-Fi climbed 1.16 per cent to $55.85.
The big banks had a pretty good day after what has been a very strong month, with Westpac adding 0.91 per cent to $24.51, NAB up 0.84 per cent to $32.37, Commonwealth increasing by 0.66 per cent to $107.07 and Macquarie rising by 2.1 per cent to $207.09, while ANZ shares rose by just 0.04 per cent to $27.88.
