RBA cuts rates to 0.5%: ASX closes 0.7% higher

Market Reports

by Rachael Jones

The Australian share market rose at the open and the local bourse managed to close 0.7 per cent higher. The Reserve Bank of Australia delivered a 25-basis-point cut, taking the cash rate to the historic low of 0.5 per cent. Bega Cheese (ASX:BGA) shares are on the rise after they reported yesterday a significant increase in earnings.Shares in Clinuvel (ASX:CUV) rose today after reporting yesterday that their supply of Scenesse – its photoprotective drug – has not been affected by coronavirus. As for the sectors today Infotech led the day and Utilities fell lower.

The S&P/ASX200 index

At the closing bell the S&P/ASX 200 index closed44 points higher to finish at 6,436.

Futures market

Dow futures are suggesting a rise of 9 points.
S&P 500 futures are eyeing a fall of 2 points.
The Nasdaq futures are eyeing a fall of 9 points.
And the ASX200 futures are eyeing a 56 point rise tomorrow morning.

Local economic news

At its meeting today, the Board decided to lower the cash rate by 25 basis points to 0.50%.
The Board took this decision to support the economy as it responds to the global coronavirus outbreak.

ABS Trade surplus dips to $1b in December quarter

Seasonally adjusted building approvals in January fell 15.3% on the prior month and 11.3% on January 2019.

Company news

Regenerative medicine company AVITA Medical (ASX:AVH) today announced the initiation of the pivotal study for soft tissue reconstruction with the enrollment of the first patient at the Arizona Burn Centre in Phoenix, Arizona. This study will evaluate the safety and effectiveness of the RECELL® System when used as an adjunct to meshed autografts in patients undergoing reconstruction of skin defects not associated with a burn injury. Shares in AVITA Medical (ASX:AVH) closed 0.8 per cent lower at $0.59.

Santos (ASX:STO) today announced the award of contracts for the supply and installation of subsea infrastructure for the Barossa project. This is the last major facilities commitments ahead of a Final Investment Decision (FID).

Ramelius Resources (ASX:RMS) released their bidders statement yesterday through its wholly owned subsidiary Mt Magnet Gold to purchase all of the shares in Spectrum Metals (ASX:SPX).

Danakali (ASX:DNK), is pleased to announce that the Colluli Mining Share Company (CMSC) has successfully executed Engineering, Procurement, Construction Management Phase 1 of Project development and has now moved to Phase 2.

Best and worst performers 

The best performing sector was Infotech adding 2.5 per cent while the worst performing sector was Financials, shedding 0.9 per cent.

The best performing stock in the S&P/ASX 200 was Xero (ASX:XRO), rising 7.2 per cent to close at $79.94. Shares in Bega Cheese (ASX:BGA) and Clinuvel Pharmaceuticals (ASX:CUV) followed higher.

The worst performing stock in the S&P/ASX 200 was Perenti (ASX:PRN), dropping 6.4 per cent to close at $1.32. Shares in Netwealth (ASX:NWL) and Jumbo Interactive (ASX:JIN) followed lower.

Asian markets

Mixed: Japan’s Nikkei has lost 0.5 per cent, Hong Kong’s Hang Seng has gained 0.4 per cent and the Shanghai Composite has gained 1.2 per cent.

Commodities and the dollar

Gold is trading at US$1,599 an ounce.
Iron ore price is 5.9 per cent higher at US$88.93.
Iron ore futures are pointing to a rise of 2.2 per cent.
Light crude is US$1.01 up at US$47.76 a barrel.
One Australian dollar is buying 65.52US cents.