Tech soars, CBA to receive $1.8b from Hangzhou deal: ASX up 1.3% at noon

Market Reports

by Lauren Evans

Starting the month off on a positive note, the Aussie sharemarket has rallied this morning thanks to a boost in technology stocks. All sectors are higher except utilities, with technology soaring over 5 per cent, followed by energy and financials.

Tech’s jump is led by Afterpay owner Block (ASX:SQ2) trading 13.3 per cent higher at $175.99, despite no official company news released today.

Major banks are adding to today’s gains with several company updates.

Commonwealth Bank (ASX:CBA) has unveiled its plans to divest its 10 per cent stake in Bank of Hangzhou. The nation’s largest bank is set to bank $1.8 billion from the transaction. The deal includes keeping its remaining 5.57 per cent stake till 2025. Shares are trading 2.3 per cent higher at $95.61.

ANZ Bank (ASX:ANZ) has made executive changes following the decision to combine its digital division and separate out its commercial businesses in Australia. Maile Carnegie will step up as group executive for Australian retail, taking over Mark Hand’s role as he departs from the bank. Shares are adding 1.3 per cent to $26.35.

Macquarie Group (ASX:MQG) has appointed Michelle Hinchliffe as an independent director to start today, following the retirement of Diana Grady. The banking giant said Hinchliffe will also become a member of Macquarie’s Board Audit, Board Risk and Board Nominating Committees. Hinchcliffe will also join BHP as an independent director after her 37-year career with KPMG. Shares are up 2.5 per cent to $185.25.

National Australia Bank (ASX:NAB) has risen 2 per cent to $29.53, and Westpac Banking Corporation (ASX:WBC) is trading 1.4 per cent higher at $23.12.

Energy stocks are higher, led by Beach Energy (ASX:BPT) adding 2.6 per cent to $1.56. Santos (ASX:STO) is up 0.8 per cent to $7.32 and Woodside Petroleum (ASX:WPL) is trading 0.9 per cent higher at $28.80.

Viva Energy (ASX:VEA) is set to splurge around $43.3 million to build a hydrogen fuel station in Geelong. The project is set to service trucks and recharge electric vehicles in a move to create a green-focused service station. Shares are up 2.5 per cent to $2.50.

Heavyweight miners are mixed with Fortescue Metals (ASX:FMG) down 0.8 per cent to $18.00 and Rio Tinto (ASX:RIO) down 0.06 per cent to $118.10, while BHP Group (ASX:BHP) is trading 0.7 per cent higher at $47.00.

Evolution Mining (ASX:EVN) is weighing on gold stocks, down 3.9 per cent to $4.11. Northern Star (ASX:NST) has fallen 2.5 per cent to $10.05 and Newcrest Mining (ASX:NCM) is trading 1.3 per cent lower at $25.35.

Sandfire Resources (ASX:SFR) is the worst performer after missing expectations yesterday. According to a note from Credit Suisse, the broker said that higher costs saw a 16 per cent earnings miss to its forecasts after reporting US$162 milion. Production guidance was largely in line, though unit costs were more than double those outlined in September attributed to a 20 to 20 per cent increase in mining and processing costs since mid-2021 attributed to increased power and labour costs. Credit Suisse has warned of further cost pressure ahead for Matsa with the company guiding to annual capital expenditure of $100 million per annum to develop and sustain the mine. The price target falls from $7 to $6.40 with its neutral rating maintained.

Elsewhere, Zip Co (ASX:Z1P) is tumbling 8.6 per cent to $2.02 after raising $148.7 million via an institutional placement, following a proposed takeover of payments company Sezzle announced yesterday.  

At noon, the S&P/ASX 200 is 1.3 per cent or 89.3 points higher at 7138.4.

The SPI futures are pointing to a rise of 80 points.

Local economic news

The Reserve Bank of Australia is set to meet at 2.30pm today under cloudy circumstances brought about by escalating tensions in eastern Europe. 

ANZ and Roy Morgan released their consumer confidence figures, which decreased 2.6 points to 99.2 during the last week of February. Consumer confidence is now 13.1 points below the same week a year ago, February 27/28, 2021 (111.3) and 2 points below the 2022 weekly average of 101.2.

The statement said almost two-thirds of the interviews for this week’s Consumer confidence were conducted prior to Russia's invasion of Ukraine. For those 947 interviews conducted from Monday – Wednesday (Feb 21-23) consumer confidence was 100.8, while for the 583 interviews conducted from Thursday-Sunday (Feb 24-27) consumer confidence had dropped to 97.1.

Driving the fall in this week’s consumer confidence were big falls in Queensland and Western Australia. Consumer confidence in Queensland was down 10.4 points to 90 as 18,000 homes have been flooded across the region according to Queensland Premier Annastacia Palaszczuk. Western Australia also took a turn this week, down 5 points to 97.4 as their Covid cases increased rapidly for the first time during the pandemic.

The Australian Bureau of Statistics released its lending indicators for January. New loan commitments rose 2.6 per cent for housing, lifted 0.8 per cent for personal fixed term loans, and jumped 41.6 per cent for business construction.

Best and worst performers

The best-performing sector is information technology, up 5.4 per cent. The worst-performing sector is utilities, down 0.9 per cent.

The best-performing stock in the S&P/ASX 200 is Block (ASX:SQ2), trading 13.3 per cent higher at $175.99. It is followed by shares in PointsBet Holdings (ASX:PBH) and Imugene (ASX:IMU).

The worst-performing stock in the S&P/ASX 200 is Sandfire Resources (ASX:SFR), trading 10.5 per cent lower at $6.00. It is followed by shares in Zip Co (ASX:Z1P) and Perseus Mining (ASX:PRU).

Commodities and the dollar

Gold is trading at US$1906.39 an ounce.
Iron ore is 4.2 per cent higher at US$139.10 a ton.
Iron ore futures are pointing to a rise of 1.43 per cent.
One Australian dollar is buying 72.55 US cents.

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