The Australian sharemarket bounced for a second straight session on Thursday to its highest level in a month as a number of pleasing economic and geopolitical developments aligned to whet traders’ risk appetites.
The heavyweight mining and banking sectors were strong and high-growth fintechs such as Block, Zip Co and Sezzle shot the lights out as the benchmark ASX 200 finished 75.6 points – or 1.05 per cent – higher at 7250.8.
The broader All Ordinaries rose by 85.8 points, or 1.15 per cent, to 7521.6 and the Australian Dollar continued its climb to hit 73.17 US cents at the local close.
Continued hopes of a ceasefire in Eastern Europe helped boost sentiment, while investors also welcomed an expected overnight US interest rate hike and improved local jobs data that showed unemployment at a 14-year low.
The intervention of the Chinese government in stock markets – and additional hints of stimulus – helped ease fears about the country’s Covid-19 outbreak and lockdowns, and proved yet another boost for local traders seeking to rebuild after a bruising month for equities.
Thursday’s gains mean the Australian sharemarket has now more than recouped the shock $74 billion loss suffered when Russia invaded Ukraine four weeks ago and there could be even better times ahead.
“Happy days for markets – and so risk assets rally,” IG Markets analyst Kyle Rodda said at the close of trade.
“We are still in a down trend in stocks. And there are concerning signals in the bond market, which point to a possible US recession.
“Nevertheless, the rally in stocks has been noteworthy. If the inflation outlook improves, Russia and Ukraine throw down their guns, and China can backstop its markets, then there could be legs to the move.”
Technology stocks starred on Thursday as risk sentiment surged.
Afterpay owner Block Inc gained a whopping 10.2 per cent to close at $157.50 and was joined in the green by fellow payment firms Zip Co, up 10.1 per cent to $1.575, and Sezzle, up 12.1 per cent to $1.485.
Accounting software firm Xero jumped 3 per cent to $99.82, Wisetech Global added 3 per cent to $50.57 and Altium rose 2.7 per cent to $32.69.
Gains for CSL, Resmed, Pro Medicus, Cochlear, Sonic and Fisher and Paykel boosted the healthcare sector, while property portals REA Group and Domain Holdings boosted telco stocks with gains of 4.5 per cent and 5 per cent respectively.
Most of the big banks gained xjmtzywground – with the exception of a flat session for Westpac – while mining giants BHP and Rio Tinto were also strong.
Fortescue Metals leapt 4.4 per cent to $18.17 as ore-reliant stocks surged on hopes of Chinese stimulus, Mineral Resources was up 3.4 per cent to $45.75, with Champion Iron rising 3.9 per cent to $6.65.
Lithium players such as Pilbara Minerals, Vulcan Energy, Novonix, Allkem and Liontown Resources also rose strongly, but coal miners were weak and gold was mixed.
Woodside Petroleum lost 1.3 per cent to $30.55 and Origin Energy was 1 per cent down at $5.79 to weigh on energy stocks, while supermarket Woolworths lost 0.7 per cent to $36.33 and rival Coles slipped 1.3 per cent to $17.87 to hurt consumer staples.
Thursday’s local rally came despite the ASX24 futures trading platform suffering a four-hour outage due to a hardware-related issue that City Index analyst Tony Sycamore expected to generate a “please explain” from regulators.
He said the breakdown prevented everyone from portfolio managers at billion-dollar hedge funds to private traders accessing liquidity over the strong Australian jobs data for February.
“(It was) a systems failure that may force institutional traders to assess whether the ASX200’s suite of futures products can remain part of their trading strategy, particularly if they cannot manage their risk over tier-one domestic data releases,” he said.
