Australian shares rose on Monday, boosted by mining stocks, while Labor leader Anthony Albanese was sworn in as the country’s 31st prime minister after nine years in power in a Conservative coalition.
key point:
- Global markets rebound despite economic jitters
- However, MSCI’s stock index posted its longest losing streak since 1990
- Oil rises as supply risks outweigh economic worries
The ASX 200 was up 37 points, or 0.5%, at 7,182 at 11:23am AEST.
Mr Albanese has committed to a “transformation journey” as he vows to tackle climate change, rising living costs and inequality.
Mining shares rose 1.6% to hit a more than two-week high after iron ore prices surged on Friday.
BHP Billiton, Rio Tinto and Fortescue Metals Group rose 2.1% to 3.8%.
Shares of Incitec Pivot fell 3.2% after surging 7.5% when the fertilizer maker said it would divest its explosives manufacturing and fertilizer businesses.
Energy stocks rose 1.1%, benefiting from strong oil prices. Major oil and gas explorers Woodside and Santos rose 1.7% and 1.9%, respectively.
The domestic tech sector was one of the biggest laggards on the local bourse, down 0.3% after following a weaker finish on Wall Street last week.
Block fell 3.5%, while WiseTech Global lost 0.8%.
Financials fell 0.1%, with Commonwealth Bank of Australia and Australia and New Zealand Banking Group down 0.1% and 0.2%, respectively.
Codan (+14.4%), Elders (+10.1%) and A2 Milk (+3.5%) rounded out the top spots.
The Australian dollar rose to 70.90 US cents at 11:24am AEST.
Mixed news on Wall Street
Global stocks rallied on Friday after the S&P 500 recovered losses that briefly pushed it into bear market territory.
China slashed its five-year loan prime rate, which affects mortgage prices, by 15 basis points, a larger-than-expected drop, as authorities sought to cushion the impact of an economic slowdown.
While a late Friday rally prevented the S&P 500 from confirming a bear market, pessimism on Wall Street led to a seventh straight weekly decline for the benchmark, the only event that has occurred since 1928, S&P Dow Jones data showed. .
Peter Tooze, president of Chase Investment Advisors in Charlottesville, Va., said how long the stock market downturn lasts will depend on when inflation bursts.
The S&P 500 closed up 0.01% after falling as much as 2.27% or below levels that would confirm a bear market — down 20% from its Jan. 3 closing high.
The Dow Jones Industrial Average rose 0.03% and the Nasdaq Composite, already in a bear market, fell 0.3%.
Stephen Auth, chief investment officer for equities at Federated Hermes, said stock valuations need to fall, while expected returns on investment (the discount rate) need to rise.
“The market is starting to digest the idea that this could be a new world where the discount rate for risky assets is no longer zero,” Mr Otter said.
“You’re going to see all these different areas of the market being hit at the same time, and that’s very unsettling for investors,” he added.
MSCI’s broadest index of 47-country stocks closed up 0.37%, but was still down for a seventh straight week, the longest losing streak since the index was launched in 1990.
Earlier in Europe, the pan-regional Stoxx 600 gained 0.73%.
U.S. Treasury yields fell for a third straight session on worries about the growth outlook. The yield on the benchmark 10-year Treasury note fell 6.5 basis points to 2.79%.
Gold prices edged higher, headed for their first weekly gain in five, on continued worries about economic growth and a drop in the U.S. dollar this week.
Oil prices steadied this week, little changed, as a planned EU ban on Russian oil balanced concerns that slowing economic growth would hurt demand.
Brent crude was up, trading at $112.91 a barrel as of 10:36 a.m. EST.
ABC/Reuters
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