The Australian sharemarket closed at record highs on Thursday, lifted by energy and retail companies after brushing off a negative lead from Wall Street.
The Australian sharemarket closed at record highs on Thursday, lifted by energy and retail companies after brushing off a negative lead from Wall Street.
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By Cindy Yin
Updated January 30, 2025 — 4.46pmfirst published at 4.09am
Welcome to your five-minute recap of the trading day.
The numbers
The Australian sharemarket closed at a record high on Thursday, led by energy and consumer discretionary stocks after lower-than-expected inflation figures released on Wednesday boosted hopes for interest rate cuts by the Reserve Bank.
The US Federal Reserve, as expected, kept rates on hold for the world’s largest economy, citing the need to assess the effects of returned President Donald Trump’s tariff and immigration policies, but the cautious sentiment on Wall Street failed to dampen investor confidence in Australia.
The S&P/ASX200 climbed 46.7 points, or 0.6 per cent, to 8,493.7 points, with all 11 industry sectors closing in the green. The Australian dollar fell, and was valued at 62.280 US cents as at 4.40 pm.
The lifters
Energy was the best performing sector, lifted by gains from Woodside Energy (up 0.7 per cent) and Yancoal (up 3.6 per cent). Whitehaven Coal was up 0.8 per cent after reporting strong coal production and sales in its quarterly results. The sector’s strong performance was also buoyed by rises from oil and gas company Karoon Energy and gold miners Emerald Resources, which leapt 7.7 per cent and 6.4 per cent respectively.
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Consumer discretionary stocks were among the biggest winners of the rate cut optimism, boosted by gains in Kmart and Bunnings owner Wesfarmers and electronics retailer JB Hi-Fi, up 0.7 per cent and 0.6 per cent, respectively. Pokiesmaker Aristocrat Leisure was up 3.7 per cent after reports of strong earnings growth in the US.
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All four big banks were also in the green, as CBA – the biggest company on the ASX – recorded gains of 1 per cent, while Westpac (up 0.7 per cent), ANZ (up 0.2 per cent), and NAB (up 1 per cent) also rose.
The tech sector was bolstered by gains from data centre operator NextDC (up 0.4 per cent), software company TechnologyOne (up 0.3 per cent) and embattled software company WiseTech, which rebounded from losses made in early trade, to rise 1 per cent.
The laggards
The Star Entertainment Group lost 7.7 per cent, stepping back its gains from Wednesday, when the cash-strapped casino operator announced sales of several of its Sydney assets, including its Star Sydney Event Centre, for $60 million to Foundation Theatres.
It was a mixed day for the miners – despite iron ore heavyweights BHP, Fortescue and Rio Tinto all adding 0.9 per cent, 0.3 per cent, and 0.7 per cent respectively, Lynas Rare Earths was one of the biggest losers on the ASX, losing 2.5 per cent. Mineral Resources and Pilbara Minerals slipped 0.9 per cent and 1.3 per cent, respectively.
The lowdown
Moomoo market strategist Jessica Amir said interest-rate sensitive sectors such as consumer discretionary stocks were rising on the back of an anticipated rate cut next month, which would deliver extra cash into the pockets of consumers.
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“Our market has got a green light to hit higher levels because interest rates could be cut,” she said. “People are excited about the future … anticipating higher company earnings and more money to be flushed in the Australian economy – because when rates are cut, people are out spending more.”
The Australian Bureau of Statistics on Wednesday said inflation cooled to 2.4 per cent in the year to December, boosting hopes for the Reserve Bank to deliver a rate cut at their meeting in February.
On Wall Street, the S&P 500 fell 0.5 per cent following the Fed’s widely expected decision to hold rates steady. The Dow Jones dipped 0.3 per cent, and the Nasdaq composite fell 0.5 per cent.
However, a $US328 billion ($529 billion) exchange-traded fund tracking the tech-heavy index whipsawed after the close of regular trading. Tesla rebounded after an initial slide that followed its results. Microsoft dropped as growth in its cloud-computing business slowed during the last three months of 2024.
Quote of the day
“The discretionary retail sector is Jonesing for an interest rate cut to breathe some life into moribund sales growth and shrinking margins. We have seen a string of profit downgrades from the sector that has now been under pressure for more than a year. The landscape is characterised by deep discounting, which hasn’t been enough to lure customers back to the shops.”
Read Elizabeth Knight’s comment on struggling retailers here.
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With AP
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