The market kicked things off on a positive note today, with the S&P/ASX200 up 69.00 points or 0.96% to 7,223.80 after a less glorious week during which it set a new 20-day low.
Investors snapped up mega-cap, tech, banking, mining and bitcoin stocks – the latter surging 4.8% to US$28.14. Oil was also up, as was the Aussie dollar, which gained 0.3% to US 65.3 cents in the greenback.
Sectors pointing up
All sectors were in the green except for Consumer Discretionary (-0.23%), with Real Estate leading the charge up 1.92%, followed by Materials (1.62%), Financials (1.31%) and Healthcare (1.00%).
Some of the relief felt by investors undoubtedly came down to the fragile agreement on Capitol Hill over the debt ceiling.
The deal looks set to pass through both houses of Congress this week in time to be signed off by the President ahead of the June 5 deadline. It’s not yet clear how much the parties have agreed to lift the ceiling – watch this space.
eToro market analyst Josh Gilbert read the room thus:
"It looks set to be a more positive week on the local market, with ASX futures pointing towards a 1% gain at the open today after falling by more than 2% last week.
“This follows a strong tailwind from US markets on Friday, with the Nasdaq gaining more than 2% alongside a tentative agreement to raise the US debt ceiling.
“The tentative agreement will take away some uncertainty for investors, and that will improve sentiment, helping to drive equities higher.
“The market’s AI-fueled tech rally of last week should also allow tech, the best-performing sector this year, to continue its strong performance.
“Risk assets are already reacting well, with bitcoin gaining 4% in 24 hours and Nasdaq futures up more than 0.5% from today’s US futures open.
“Investors hoping for a large, sustained rally may be disappointed, however. The Nasdaq rose 3.5% last week to its highest level since August, meaning much of the good news may already be priced in.
“We are already seeing that initial relief, but US PCE on Friday showed inflationary pressures had picked up, leaving markets to price in a 65% chance of another hike from the Federal Reserve for its June meeting.
“This is in stark contrast to the 17% chance of a hike last week, which may spoil the party. US markets are also closed until Tuesday due to the Memorial Day holiday.”
IG analyst Tony Sycamore added: “While the weekend's debt deal has enabled markets to breathe a sigh of relief, the market will likely soon focus on the impact of tighter liquidity, a sovereign debt downgrade, and higher interest rates.”
The five at five
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St George Mining yields peak lithium values of 1.77% Li2O at Jailbreak
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Recce Pharmaceuticals recruits outpatient nurses to drive “largest in Australia” diabetic foot infection clinical trial
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Southern Gold intersects elevated silver and gold grades at Deokon Main Mine in South Korea
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Predictive Discovery raises $40.4 million to drive growth at Bankan Gold Project
Predictive Discovery Ltd (ASX:PDI, OTC:PDIYF) will use the A$40.4 million raised in a strongly supported placement to drive growth and advancement of the 4.2-million-ounce Bankan Gold Project in the Siguiri Basin in Guinea.
On your six
Empire Energy Group welcomes ‘nationally significant’ Beetaloo Basin resource
Empire Energy Group Ltd (ASX:EEG, OTC:EEGUF) MD Alex Underwood talks to Proactive about the company’s breakthrough with an independent LNG resource at permit EP187 in the highly prospective Beetaloo Basin, representing a “nationally significant” resource of low CO2 gas.
The one to watch
Evolution Energy Minerals makes key US appointments for downstream processing
Evolution Energy Minerals Ltd (ASX:EV1) MD Phil Hoskins tells Proactive the company has appointed Stacy Newstead as CEO of its wholly-owned US subsidiary, Evolution Energy Solutions LLC. She will lead the implementation of the company’s downstream processing strategy, with the end goal of producing coated spherical purified graphite (CSPG) on US soil.