RBA holds rates, Tech lifts, Iron ore miners drag: ASX closes 0.5% higher

Market Reports

by Lauren Evans

The Australian sharemarket maintained momentum in the afternoon thanks to gains in the utilities and technology sectors. Tuesday's session saw all sectors close in the green except materials, while a number of companies reported updates today amid fresh economic data.

Following the RBA meeting this afternoon, the board decided to maintain the cash rate target at 10 basis points and the interest rates at zero per cent. The board also decided to cease further purchases under the bond purchase program, with the final purchases to take place on February 10. The central bank said that they are prepared to be "patient" as they monitor how the various factors affecting inflation in Australia evolve.

In M&A’s, US payments giant Block has completed its scheme of arrangement to buy Aussie buy now, pay later darling Afterpay, with former Afterpay Sharon Rothstein to join Block's board. Shares in Block (ASX:SQ2) closed 5.8 per cent higher at $170.80. 

Healius (ASX:HLS) has also completed the acquisition of all of the issued capital of bioanalytical firm Agilex Biolabs valued at $301.3 million. Shares closed 0.9 per cent higher at $4.48. 

Humm Group (ASX:HUM) are still in talks with Latitude Financial about the potential sale of Humm's BNPL, installment and credit card operations. Shares closed 3 per cent higher at $0.86. 

Ramsay Health Care (ASX:RHC) has completed its $1.4 billion purchase of UK-based mental healthcare provider Elysium Healthcare, announced in December. Ramsay said the acquisition is slated to provide a leg into the growing UK mental health hospital market with opportunities for both organic and inorganic growth. Shares closed 2.7 per cent higher at $64.71. 

Credit Corp (ASX:CCP) has upgraded its guidance after a strong first half result, driven by a step up in US purchased debt ledger (PDL) and its acquisition of Radio Rentals. The company’s net profit after tax grew 8 per cent to $45.7 million for the half. Shares closed 3 per cent higher at $34.90. 

Building business Boral (ASX:BLD) has announced a $3 billion return of surplus capital to shareholders following the sale of two divestments. Boral is set to pay a special dividend of $2.72 per share via a $2.65 per share capital reduction and a 7 cents per share unfranked dividend. Shares closed 6.1 per cent higher at $6.23. 

Meanwhile, Centuria Industrial REIT (ASX:CIP) posted its statutory profit growth to $308.1 million in the first half of financial year 2022 after including a $256.7 million increase on revaluation of its property assets for the six months. Shares closed 3.8 per cent higher at $3.94. 

Major banks finished higher except ANZ Bank (ASX:ANZ) which closed flat at $26.53. Macquarie (ASX:MQG) led the gains, closing 2.7 per cent higher at $188.62, while National Australia Bank (ASX:NAB) added 1.9 per cent to $27.64, Westpac Banking Corporation (ASX:WBC) was up 0.5 per cent to $20.40 and Commonwealth Bank of Australia (ASX:CBA) closed 0.2 per cent higher at $93.93.

BHP (ASX:BHP) led the declines in iron ore players, closing 3.1 per cent lower at $44.93, while Rio Tinto (ASX:RIO) fell 2.4 per cent to $108.90 and Fortescue Metals Group (ASX:FMG) closed 0.7 per cent lower at $19.73.

Energy stocks were mixed as Woodside Petroleum (ASX:WPL) was down 0.04 per cent lower at $25.06, Beach Energy (ASX:BPT) fell 0.7 per cent at $1.47 and Santos (ASX:STO) closed 0.6 per cent higher at $7.18.

Gold stocks closed higher led by Newcrest Mining (ASX:NCM) up 3.5 per cent to $22.30, while Northern Star (ASX:NST) added 2.2 per cent at $8.47 and Evolution Mining (ASX:EVN) closed 2 per cent higher at $3.57.

At the closing bell, the S&P/ASX 200 was 0.5 per cent or 34 points higher at 7,006.

Local economic news

Home values rose 1.1 per cent on average in January, up 10 basis points on December’s monthly gain as per CoreLogic. Five of the eight capital cities recorded a modest uptick in the monthly rate of growth, including Melbourne, which had posted a slight decline in values in the previous month. However, the quarterly change continued to soften, reflecting the longer-term trend of slowing growth across most regions of Australia. The annual change in national housing values reached a new cyclical high in January, with Australian dwellings up 22.4 per cent over the year, the highest annual rate of growth since June 1989.

New loan commitments for housing rose 4.4 per cent to a record high value of $32.8 billion, seasonally adjusted in December 2021, according to the Australian Bureau of Statistics. December’s rise was driven by a 5.3 per cent rise in the value of new owner-occupier loan commitments. This is the second consecutive monthly rise in owner-occupier lending and follows the falls seen from June 2021 through to October 2021.

Australian retail turnover fell 4.4 per cent in December 2021, seasonally adjusted, according to the Australian Bureau of Statistics. The December result follows consecutive rises of 7.3 per cent in November 2021, 4.9 per cent in October 2021, and 1.3 per cent in September 2021.

Consumer confidence rose 1.7 per cent in the past week as per ANZ-Roy Morgan.

Futures

The Dow Jones futures are pointing to a fall of 75 points.
The S&P 500 futures are pointing to a fall of 13 points.
The Nasdaq futures are pointing to a fall of 38 points.
The SPI futures are pointing to a rise of 40 points when the market next opens.

Best and worst performers

The best-performing sector was Utilities, up 2.6 per cent. The worst-performing sector was Materials, down 1.2 per cent.

The best-performing stock in the S&P/ASX 200 was Appen (ASX:APX), closing 7.9 per cent higher at $10.38. It was followed by shares in Pendal Group (ASX:PDL) and Imugene (ASX:IMU).

The worst-performing stock in the S&P/ASX 200 was BHP Group (ASX:BHP), closing 3.1 per cent lower at $44.93. It was followed by shares in Brambles (ASX:BXB) and Rio Tinto (ASX:RIO).

Asian markets

Japan's Nikkei has gained 0.3 per cent.
Hong Kong's Hang Seng is closed for Chinese New Year.
China's Shanghai Composite is closed for Chinese New Year.

Commodities and the dollar

Gold is trading at US$1801.14 an ounce.
Iron ore is 4.2 per cent lower at US$141.75 a ton.
Iron ore futures are pointing to a rise of 7.6 per cent.
Light crude is trading $0.37 higher at US$88.52 a barrel.
One Australian dollar is buying 70.63 US cents.

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