The Australian sharemarket rose for the fourth straight day, with the resources sector driving the gains and a speech by the boss of the central bank having little impact.
Helped by a positive lead from Wall Street, the benchmark S&P/ASX200 index strengthened 1.17 per cent to 7087.7 while the All Ordinaries Index gained 1.19 per cent to 7399.6.
OMG chief executive Ivan Tchourilov said the market was mostly unaffected by Reserve Bank of Australia governor Philip Lowe’s Press Club speech.
“The RBA is expecting to see a rate hike in 2023, still defying expectations of the big four banks and bond markets for a hike this year,” Mr Tchourilov said.
“Reserve banks have been erring on the side of caution while the economic situation unravels, preferring to take a flexible and reactive approach instead of trying to stay ahead of the pandemic.
“Responding quickly is key and the reserve bank will need to be careful not to let inflation run away in the interim.”
CommSec senior economist Ryan Felsman noted that in the question and answer session following his speech, Dr Lowe said: “It’s certainly a plausible scenario that rates go up later this year, but there are a lot of other scenarios as well.
“There are a lot of uncertainties both on the supply side and in the labour market.”
Mr Tchourilov said energy was the strongest sector, underpinned by geopolitical tensions that were pushing oil prices higher.
Strike Energy surged 15.9 per cent to 25.5 cents after its Project Haber urea fertiliser production facility to be built near Geraldton in Western Australia was awarded major project status by the federal government.
Woodside added 3.3 per cent to $25.89, Santos liftexjmtzywd 2.93 per cent to $7.39 and Beach Energy improved 2.72 per cent to $1.51.
Iron ore miners also did a lot of heavy lifting despite Chinese markets being closed for the Lunar New Year, Mr Tchourilov said.
BHP – now the biggest stock on the ASX after delisting from the London Stock Exchange – found 1.58 per cent to $45.64.
Fortescue appreciated 3.7 per cent to $20.46, Champion Iron jumped 6.15 per cent to $6.73 and Rio Tinto gained 2.3 per cent to $111.43.
Superannuation giant HESTA responded to Rio Tinto’s public release on Tuesday of an external review into its workplace culture showing rife sexual harassment, racism and bullying, describing it as “extremely concerning for investors”.
“HESTA will be writing to mining companies to understand how they are considering these issues,” it warned.
Rio Tinto majority-owned Energy Resources of Australia revealed the cost of rehabilitating its Ranger uranium project area in the Northern Territory had blown out to $1.6bn-$2.2bn, up from a $973m estimate in 2019.
“This includes the creation of a landform and a sustainable ecosystem that will enable ERA to meet its obligations to return the land to an environment similar to the adjacent areas of the world heritage listed Kakadu National Park,” ERA said.
ERA shares lifted 1.56 per cent to 32.5 cents.
Brockman Mining rocketed 39.13 per cent to 6.4 cents a day after its Marillana and Ophthalmia joint venture partner Mineral Resources and Gina Rinehart’s Hancock Prospecting were granted the right to build a new iron ore export berth at Port Hedland.
The far more expensively priced Mineral Resources rose 2.18 per cent to $58.65.
BetMakers jumped 14.84 per cent to 73.5 cents after the Waterhouse VC fund became a major shareholder, with 8 per cent of voting rights.
“BetMakers and the Waterhouse Group paired up to create the tomwaterhouse.com betting application and trading desk previously, delivering $8m in revenue during the first half of the 2021-22 financial year for BetMakers,” Mr Tchourilov said.
“Their share price has been seriously depressed in recent months for various macroeconomic reasons, which could be a nice entry point for retail investors.
“The prospect of rising interest rates can take a bite out of valuation for companies like BetMakers, however, it’s worth noting that the company is essentially debt-free and operating with a positive cash flow.”
The tech sector was marginally weaker, with Afterpay acquirer Block dropping 5.64 per cent to $161.55.
Consumer discretionary was the third best performing sector, with Beacon Lighting leaping 7.94 per cent to $2.99 and City Chic appreciating 3.7 per cent to $5.33.
ANZ rose 1.36 per cent to $26.89, Commonwealth Bank firmed 0.86 per cent to $94.74, National Australia Bank lifted 0.83 per cent to $27.87 and Westpac improved 0.98 per cent to $20.60.
The Aussie dollar was buying 71.38 US cents, 52.76 British pence and 63.28 Euro cents in afternoon trade.
