ASX defies Wall Street selloff as banks and retailers advance​on January 28, 2025 at 2:56 am

Meanwhile, energy stocks weakened after oil prices sunk by 1.7 per cent on Monday as US President Donald Trump threatened to introduce a wide-ranging set of tariffs on imports, including potentially on some key industrial commodities such as steel, aluminium and copper.

Uranium producers Deep Yellow and Paladin Energy posted the biggest losses at around midday, slipping 17.5 per cent and 11 per cent, respectively.

The top-performing stocks at midday was pharma giant Sigma Healthcare with a gain of 11.5 per cent. It comes after its merger partner Chemist Warehouse said its total retail network first-half sales rose 13 per cent to a record $5.15 billion. The two companies are set to complete their tie-up in February, a decision approved by the ACCC despite concerns of market concentration from other industry players.

In the mining sector, Fortescue added 1 per cent after news that the mining giant has entered a deal with Red Hawk Mining to gain access to an undeveloped iron ore mine near its major Solomon project in Western Australia. The offer price of as much as $1.20 cash per share implies a fully diluted equity value for Red Hawk of $254 million, Fortescue said on Tuesday. Red Hawk’s share price soared more than 45 per cent to the offer price.

Lithium miners Pilbara lost 2 per cent as investors await a quarterly update late on Tuesday afternoon. BHP was up 0.8 per cent, while Rio Tinto added 0.1 per cent.

All four big banks were in the green, as CBA – the biggest stock on the ASX – lifted 0.7 per cent, while Westpac, ANZ and NAB all rose about 1 per cent, respectively. This comes after CBA announced on Friday it had sold its remaining 5.45 per cent stake in Chinese lender Bank of Hangzhou for about $940 million, after it sold a larger stake in the bank in 2022.

Consumer discretionary was the best performing sector by lunchtime, buoyed by gains from gambling machine manufacturer Aristocrat Leisure (up 3 per cent), white goods and furniture retailer Harvey Norman (up 0.4 per cent) and retail conglomerate Wesfarmers, the owner of Kmart, Officeworks and Bunnings (up 0.6 per cent).

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On Wall Street, the S&P 500 dropped 1.5 per cent overnight, dragged down in large part by a 16.9 per cent fall for Nvidia. Other Big Tech stocks also took heavy losses, and they pulled the Nasdaq composite down 3.1 per cent for its worst loss in more than a month.

The damage was focused on AI-related stocks, while the rest of the market held up much better. The Dow Jones rose 289 points, or 0.7 per cent, and the majority of US stocks climbed. But anyone holding an S&P 500 index fund, which are found in many pension savings, felt the pain because of how influential those tech giants have become on indexes.

DeepSeek had already hit the top of the chart for free apps on Apple’s App Store by Monday morning. Scepticism, though, remains about how much DeepSeek’s announcement will ultimately shake the economy that’s built around the AI industry, from the chipmakers making semiconductors to the utilities hoping to electrify vast data centres gobbling up computing power.

“It remains to be seen if DeepSeek found a way to work around these chip restrictions rules and what chips they ultimately used as there will be many sceptics around this issue given the information is coming from China,” said Dan Ives, an analyst with Wedbush Securities.

DeepSeek’s disruption nevertheless rocked AI-related stocks worldwide.

Dutch chipmaking equipment company ASML slid 7 per cent. Japan’s Softbank Group lost 8.3 per cent.

All the worries sent investors toward bonds as safe havens. The rush pushed the yield of the 10-year Treasury down to 4.52 per cent from 4.62 per cent late on Friday.

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AP

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