The Match Out: Powell sends stocks higher, Materials lead the way

James Gerrish

Market Matters

US stocks rallied late in their session to close ~3% higher, while the Nasdaq put on ~4.5% as technology stocks enjoyed the rhetoric from the Federal Reserve around interest rates. That trend played out locally today with the ASX hitting its highest level since May – Tech & Resources are the main beneficiaries of the move which suits our current positioning – more of the same please! Local shares did pare some of the gains as the session rolled on, however it was still a bullish session as some of the more beaten-down areas of the market found some love.

  • The ASX 200 finished up +70pts/ +0.96% at 7354
  • The Materials sector was best on ground (+2.65%) while Utilities (+1.17%) & Real Estate (+1.05%) were also strong.
  • Energy (-0.84%) and Healthcare (-0.37%) were the only sectors to close lower.
  • Downer (ASX: DOW) -2.32%, announced their CEO/MD will retire next year with the current COO, Peter Tompkins set to replace him. Peter has been with Downer for 14 years and was integral to the Spotless acquisition, knowing the business inside and out.
  • Domino’s Pizza (ASX: DMP) halt, raising $150m through a placement today to pay for the remaining share of their German expansion JV. The deal at a floor price of $65.05 is just a 2% discount to yesterday’s close – not much meat on that bone! The company reaffirmed guidance provided at the AGM last month.
  • Woodside (ASX: WDS) -1.72%, hosted an investor day today, showing mild production growth expectations over the medium term. It’s the second slightly disappointing production guidance from the company this week.
  • Rio Tinto (ASX: RIO) +3.29%, a positive move from the miner today coming off the back of their investor day last night. Production guidance was as expected, if not a touch light in copper, however that was enough to impress.
  • Iron Ore was ~0.65% lower in Asia today, though USD weakness and commodity strength overnight supported the bulk miners
  • Gold was up $US11 / +0.64% in Asian trade today, settled $US1780 at out close.
  • Asian stocks were strong today, Nikkei, Hang Seng and China all more than 1% higher at the time of writing.
  • US Futures are all up, around +0.20%

ASX 200 Chart

Broker Moves

  • Leo Lithium Ltd Rated New Speculative Buy at Argonaut Securities
  • Reliance Worldwide Rated New Neutral at Jarden Securities
  • Cleanaway Rated New Neutral at Barrenjoey; PT A$2.90
  • Chrysos Corp. Rated New Speculative Buy at Taylor Collison
  • NobleOak Life Rated New Outperform at Taylor Collison; PT A$2.14

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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