The ASX surprised on the upside despite heavy losses on US markets overnight, with the highest oil prices in eight years boosting energy stocks.
The Australian sharemarket shrugged off a Wall Street bloodbath to post decent gains, with winners including energy stocks, which benefited from the highest oil prices in eight years.
The benchmark S&P/ASX200 index closed 0.6 per cent higher at 7120.2, while the All Ordinaries Index rose the same amount to 7418.9.
CommSec analyst Steven Daghlian said it was choppy trade, kicking off with a surprisingly positive start after major losses on Wall Street overnight.
The S&P500 had its worst plunge in almost a year, while the teach-heavy Nasdaq index tumbled a whopping 3.7 per cent, its worst day since late 2020.
The main catalyst was Facebook’s parent company, Meta Platforms, issuing a disappointing fourth quarter earnings report, sending its shares plummeting more than 26 per cent.
“It said user numbers had fallen … it blamed Apple’s changes to privacy, but also at the same time, it said more people were using social media platforms like TikTok,” CommSec senior economist Ryan Felsman said.
Mr Daghlian said Meta’s epic tumble was its biggest ever daily drop, wiping an eye-watering $230bn off its market value.
“That’s the most loss by any US company on the market in just one session,” he said.
But in after hours trade, Amazon’s fourth quarter results turned sentiment, prompting a double-digit share price rise and leading US futures higher.
IG market analyst Kyle Rodda said Amazon’s numbers weren’t stellar by any means but earnings per share smashed expectations.
“The results partially, although not entirely, offset the impact of Meta Platform’s woeful performance last night, and the impact it had on US equities and general market sentiment,” Mr Rodda said.
Locally, the IT sector was in fact the second top performer, with Branchip Holdings jumping 9.12 per cent to $1.73, Zip rising 3.09 per cent to $3,WiseTech Global gaining 2.47 per cent to $43.64 and Appen firming 0.64 per cent to $9.46.
OMG chief executive Ivan Tchourilov said the Reserve Bank of Australia’s statement on monetary policy – the third public utterances for the central bank this week – had little impact on the ASX, despite upgrading expected peak inflation and jobless rates.
“The RBA’s reactionary approach is putting them behind the curve of financial markets, who are making and following their own predictions,” Mr Tchourilov said.
ANZ inched two cents higher to $27.09, Commonwealth Bank added 0.7 per cent to $94.10, National Australia Bank was unchanged at $27.91 and Westpac improved 2.14 per cent to $21.52.
Oil prices climbed above $US90 a barrel for the first time since 2014, as supply remains tight against a backdrop of geopolitical tensions.
Beach Energy appreciated 1.7 per cent to $1.49, Santos put on 0.95 per cent to $7.45 and Woodside lifted 1.12 per cent to $26.27.
Rio Tinto firmed 0.4 per cent to $114.61, BHP dropped 0.5 per cent to $46.81 and Fortescue gained 0.99 per cent to $21.34.
REA Group, which is majority owned by the publisher of this title News Corp, reported a jump in first half revenue and profits thanks to a wave of new property listings on its realestate.com.au website after Covid-19 restrictions eased.
Sellers were “making up for the time lost in lockdown and taking advantage of the significant buyer demand,” chief executive Owen Wilson said.
Citi said the result beat forecasts, with revenue slightly ahead of consensus and costs growth lower than expected.
Shares in REA, which is paying out its biggest ever dividend, dipped 0.4 per cent to $143.45.
News Corp jumped 5.73 per cent to $33.38 after reporting a rise in second quarter revenue, with chief executive Robert Thomson saying digital real estate services, Dow Jones and book publishing divisions were thriving in particular.
“In addition to the substantial deals with Google and Facebook, we expanded our multi-year global agreement with Apple, which is expected to be an important source of subscriptions and of advertising revenue for our news sites around the world,” he said.
Qantas leapt 4.85 per cent to $5.19.
“Investors are becoming bullish on the airline, with Australia edging closer to allowing more tourists back into the country,” Mr Tchourilov said.
Building products company Boral went ex-dividend, falling 41.8 per cent to $3.80, reflecting “not a bad payout ratio for stock that closed at $6.53 yesterday”, he said.
Mayne Pharma Group gave up 3.5 per cent to 27.5 cents after healthy gains earlier this week.
Vehicle accessories group ARB Corp slid 3.6 per cent to $44.33 “as its poor run so far in February continues”, Mr Tchourilov said.
The Aussie dollar was fetching 71.44 US cents, 52.51 British pence and 62.3 Euro cents in afternoon trade.
Originally published as Australian sharemarket gains ground despite big losses on US markets overnight
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