The Australian share market experienced a strong rally on Wednesday, propelled by better-than-expected earnings from major financial institutions. The S&P/ASX 200 Index jumped 1.5 per cent, or 130.30 points, to 88875.70, nearing its record high. Financial stocks led the charge, offsetting losses from CSL. Commonwealth Bank is Australia’s largest lender and provides a range of financial services, including retail, business and institutional banking.
Commonwealth Bank shares surged 7.6 per cent after its cash profit surpassed market expectations by $200 million, and its interim dividend of $2.35 exceeded the consensus forecast of $2.31. Other banks also saw gains, with National Australia Bank, Westpac, and ANZ rising by 2.4 per cent, 2.6 per cent, and 1.2 per cent, respectively. The materials sector also contributed to the positive market sentiment, with James Hardie shares climbing 13.6 per cent after reporting a strong EBITDA.
However, CSL shares plummeted 6.5 per cent following the abrupt departure of its chief executive, Paul McKenzie, and a reported 81 per cent slump in half-year earnings to $US400 million ($566 million). CSL is a global biotechnology company that researches, develops, manufactures, and markets a range of pharmaceutical products. Citi analysts cautioned that CSL’s full-year guidance is now at risk after first-half sales and underlying profit missed expectations.
In other corporate news, AGL Energy shares rose 9.3 per cent after its EBITDA beat consensus by 7 per cent, and the company reported a half-year profit of $351 million. Aussie Broadband shares also surged 12.1 per cent following an agreement to acquire AGL Energy’s telecommunications business and customer assets. Conversely, ASX Ltd shares fell 3.3 per cent after the unexpected resignation of its chief executive, Helen Lofthouse.
