ASX closes 0.74% higher as bond yields decline

Market Reports

by Peter Milios

On Thursday, the Australian stock market made significant progress, driven by strong increases in cyclical stocks. This surge was fueled by a continued decline in bond yields, which raised expectations of imminent interest rate cuts, a possibility that was not previously anticipated.

The yield on the US 10-year Treasury bond has dropped to less than 4.3 percent, marking a significant decline of 57 basis points within the last month. Renowned billionaire investor Bill Ackman expressed his belief that his firm, Pershing Capital, is placing a bet on the Federal Reserve having to implement interest rate cuts at a faster pace than what most people anticipate.

By the time the trading day concluded, the S&P/ASX 200 had risen by 0.74 percent to reach 7,087.30 points. Remarkably, nine out of the eleven sectors in the market were in positive territory. Additionally, the All Ordinaries index also registered a gain of 0.7 percent.

Futures

The Dow Jones futures are pointing to a rise of 140 points.

The S&P 500 futures are pointing to a rise of 7.25 points.

The Nasdaq futures are pointing to a rise of 35.25 points.

The SPI futures are up 46 points.

Best and worst performers

The best-performing sector was Industrials, up 1.43 per cent. The worst-performing sector was Utilities, down 0.95 per cent.

The best-performing large cap was Insurance Australia Group (ASX:IAG), closing 3.13 per cent higher at $5.94. It was followed by shares in Reece (ASX:REH) and Suncorp Group (ASX:SUN).

The worst-performing large cap was AGL Energy (ASX:AGL), closing 2.68 per cent lower at $9.43. It was followed by shares in Mercury NZ (ASX:MCY) and REA Group (ASX:REA).

Asian markets

Japan's Nikkei has gained 0.24 per cent.

Hong Kong's Hang Seng has lost 0.05 per cent.

China's Shanghai Composite has lost 0.16 per cent.

Company news

Australian Pacific Coal (ASX:AQC) secured a 3-year USD60 million (~AUD90 million) debt facility from Vitol Asia, a global energy and commodities company, for its Dartbrook Joint Venture in the Hunter Valley, which produces high-quality thermal coal. The Funds will cover all remaining restart capex through to first coal and the acquisition of additional mining systems during ramp-up. Shares closed 3.57 per cent lower at 13.5 cents. 

Augustus Minerals (ASX:AUG) announced that a review of soil sampling data completed by the Company has returned high tenure lithium and rubidium results in and around the Peak Bore prospect area. Looking ahead, the technical team is already working up exploration programs for 2024 and will use this data to redefine their priorities in this area. Shares closed 4.55 per cent higher at 11.5 cents. 

Battery Age Minerals (ASX:BM8) announced multiple +20m spodumene-bearing pegmatite intercepts at its 90%-owned Falcon Lake Lithium Project in Ontario, Canda, highlighting the potential scale of the mineralised system. In response, Battery Age Interim CEO, Nigel Broomham, commented, “the team has only just begun to scratch the surface, and we believe the recent results highlight the potential to identify discoveries of scale at Falcon Lake.” Shares closed 6.38 per cent lower at 22 cents. 

Commodities and the dollar

Gold is trading at US$2,044.10 an ounce.

Iron ore is 0.8 per cent higher at US$130.45 a tonne.

Iron ore futures are pointing to a 0.2 per cent rise.

Light crude is trading $0.20 higher at US$78.06 a barrel.

One Australian dollar is buying 66.17 US cents.

Peter Milios

Peter Milios is a recent graduate from the University of Technology - majoring in Finance and Accounting. Peter is currently working under equity research analyst Di Brookman for Corporate Connect Research.

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