Rebounding from an 11 month low reached yesterday, the ASX 200 ended the day higher, gaining 0.64%.
Real estate led the gains and the major banks rallied, rebounding from yesterday’s sell-off. Tech stocks were also strong with Xero and NextDC both closing more than 2% higher.
Energy closed down 0.74% having clawed back much of its morning losses that were a response to a massive 5% drop in the crude oil price overnight — the biggest fall in over a year and wiping out oil’s year-on-year gains. Woodside Energy fell 0.68% and Whitehaven Coal (ASX:WHC) lost 1.68.
Boosted by stronger gold prices, gold miners rallied. Spot gold is priced $US1,827.77 per ounce, a lift from its 7-month lows reached on Tuesday. Northern Star Ltd is up 4.32%, Evolution Mining Ltd (ASX:EVN) gained 2.84%, and Bellevue Gold Ltd (ASX:BGL) jumped 3%.
Investor sentiment to improve
Axioma head of applied research, APAC, Olivier d’Assier expects investor sentiment to recover across markets.
“Investor sentiment saw a late week rebound in all markets we follow, except in Japan and global ex-US markets where it remained unchanged (China was closed on Friday).
“Concerns about the slowing global economy were made worse in the last two weeks, by worries about a potential US government lockdown and slowing Chinese manufacturing activity. Both concerns seem to have been avoided over the weekend with a last-minute deal for a continuing resolution in the US, funding the government until mid-November, and better than expected PMI data in China.
“While the Chinese market will remain closed for most of this week in celebration of the Golden Week festivities, we can expect sentiment to continue to recover across all other markets.
“In the last two months, investors have come to grips with the first signs that the economy is being affected by the unprecedented rise in interest rates of the last 18 months, as well as the reality that central banks are going to keep interest rates higher for longer than previously thought.
“Those macro worries were compounded by political concerns in the US (shutdown), stimulus concerns in China (will it work?), and fears of currency intervention in Japan (USD/JPY 149.50!). All three weighing further on sentiment.”
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