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Aussie share rally continues

The Aussie market has extended its winning run to a seventh straight session, albeit in unconvincing fashion, on Tuesday, says James Tao at CommSec.

“The ASX 200 finished the day 4.7 points or 0.07% higher at 6745.4. The index dipped into the red briefly at lunch before recovering in afternoon trade.

 “It was a fairly even split between winners and losers among the top 200 stocks with some of the biggest improvers coming from the tech sector.

“Financial data provider, Iress Ltd (IRE) gained 4.6%, Xero (XRO) was 2.7% higher and Bravura Solutions (BVS) rallied 4.7% with the software solutions provider announcing the acquisition of another software firm, FinoComp, for $25 million”

 · Health and mining stocks were the other supports for the broader market, helping keep the benchmark index in the black. Major miners BHP Group (BHP) and Rio Tinto (RIO) both rose more than 1%. Mineral Resources (MIN) saw a gain of 4.6% with the Foreign Investment Review Board (FIRB) not objecting to the proposed sale of its 60% stake in the Wodgina lithium Project to US-based miner Albermarle. Local lithium miner, Orocobre (ORE) also rose 4.5%. Sims Metal (SGM) also managed to claw back some of its recent losses, climbing 5.3% on broker upgrades.

· Offsetting improvements were losses for the financials. The big four banks were all lower, but to varying degrees. Westpac (WBC) was the major laggard as it slipped 0.9% while Commonwealth Bank (CBA) stood out with a small 0.02% decline. Energy stocks were also weaker with global oil prices falling on oversupply concerns. Beach Energy (BPT) was the one of the worst performers falling 2.9%.

· In other company news, Coles Group (COL) climbed 3.1% after announcing its first quarter sales update for FY20. Sales growth was rather flat for the period, only increasing 0.2% from the same comparable period in FY19. Revenue came in at $8.7 billion. On the other hand, Bega Cheese (BGA) slumped 12.8% on an earnings downgrade. The prolonged drought is raising milk prices, which will negatively affect BGA’s earnings for the coming year.

· The Aussie dollar is buying 68.5 US cents ahead of key releases for local inflation and the US Fed interest rate decision. Today, 2.7b units were traded worth $6.1b with 532 higher, 621 lower and 398 unchanged. In the US home prices, pending home sales and consumer confidence data are due.


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