The Match Out: Bang! US Inflation may still be “hot” but stocks enjoy a huge relief rally!

James Gerrish

Market Matters

Friday delivered a very different story to most of 2021/22 with stocks rallying aggressively following a stronger-than-expected US inflation print. The risk on theme from Thursday night which saw the Dow surge over 800-points followed through locally with the ASX200 posting a solid triple-digit gain with losers very thin on the ground as all 11 sectors rallied by over 1%, it might not feel like it but October is now up around 300-points and were still only mid-month.

  • The ASX 200 finished up +116pts/ +1.75% at 6758
  • The Energy sector was best on ground (+3.75) while the Utilities (+3.62%) were a close second.
  • Industrials (+1.37%) and Materials (+1.38%) were the weakest links but still closed positive.
  • Banks maintained their stellar rally for the week with Virgin Money (ASX: VUK) playing some catchup on its domestic peers closing up over +10% on the day.
  • It was an unusual mix of stocks at the pointy end of today's gains with no obvious theme, The top performers names included a bank, fast food company, tech, healthcare company and insurance stocks.
  • The days naughty corner again contained Pilbara (ASX: PLS) but Allkem (ASX: AKE) was one of the best performing lithium plays i.e. not all boats rise as one.
  • Iron Ore was ~0.7% higher in Asia today supporting Fortescue (ASX: FMGwhich rallied 0.7% & Rio Tinto (ASX: RIO) +1.0%
  • Gold was slightly lower overnight closing ~US$1977 before drifting another ~$US4/oz in Asian trade today, settling at $US1673 at the close.
  • Asian stocks rallied in line with the global mood, both Japan’s Nikkei was and the Hang Seng surged +3.4%.
  • US Futures are all up, around +0.60% extending the overnight gains in the process.

ASX 200 Chart 

Sectors This Week

Stocks This Week

Broker Moves

  • Genex Power (ASX: GNX) Raised to Speculative Buy at Canaccord
  • Qantas (ASX: QANraised to neutral at Citi – PT $5.78
  • Lottery Corp. (ASX: TLC) rated new sell at Goldman – PT $3.50
  • PointsBet (ASX: PBH) reinstated neutral Goldman – PT $2.22
  • Jumbo Interactive (ASX: JIN) reinstated as buy at Goldman – PT $15.30
  • Tabcorp (ASX: TAH)  cut to sell at Goldman- PT 80c
  • Cochlear (ASX: COH) raised to buy at Jefferies – PT $219.30

Major Movers Today

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James Gerrish
Portfolio Manager
Market Matters

James is Portfolio Manager & Primary Author at Market Matters, a daily investment report with over 2500 subscribers that offers real market insight. He is also Senior Portfolio Manager within Shaw and Partners heading up a team that manages...

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