Zip, Pointsbet soar as ASX firmly green
Travel, bank and tech stocks helped propel the ASX higher, recording its best day in nine weeks amid a bit of an executive exodus.
Volatility once again prevailed on the Australian sharemarket, but it climbed firmly into the green, enjoying its best day in about two months.
The benchmark S&P/ASX200 index closed 0.95 per cent higher at 7313.9, while the All Ordinaries Index rose 1.01 per cent to 7605.2.
CommSec analyst Tom Piotrowski said it had been eventful on global markets overnight, notably US chief medical adviser Anthony Fauci advising the Biden administration the Omicron variant was perhaps not as lethal as initially thought.
“Chinese authorities have cut the required reserve ratio for Chinese financial institutions, which will liberate quite a bit of money into the Chinese economy that will be freed up for lending and promote activity,” Mr Piotrowski said.
“Those things underpin the gains that we’ve seen for not only northern hemisphere markets but also the pulse for the local market over the past day.”
The local bourse jumped shortly after opening, faltered, then took off again in late trade after the Reserve Bank of Australia kept the cash rate at a historic low.
OMG chief executive Ivan Tchourilov said it was three straight days in the green but warned choppiness would continue.
“Intraday swings will still be a problem, so hold onto your hats,” he said.
“Micro and small caps are making a comeback after a heavy sell-off in recent days.”
Tech stock Tesserent was the top performing stock in the All Ords, rocketing 16.67 per cent to 17.5 cents after announcing the acquisition of two companies with “leading positions in the federal government marketplace”.
Other stocks in the sector rebounded – particularly buy-now-pay-later – with Zip surging 9.9 per cent to $4.77 after providing a trading update for November showing transaction volume was now annualising at more than $10bn.
There were other flattering figures, Mr Piotrowski noted.
Afterpay put on 1.84 per cent to $95.73, Sezzle shot up 6.3 per cent to $3.37 and Splitit gained 2.08 per cent to 24.5 cents, but Laybuy slumped 9.76 per cent to 18.5 cents.
“While the charts of Afterpay and Zip don’t paint a pretty picture, there’s no shortage of people looking to buy into the sector,” Mr Tchourilov said.
“The same goes for travel stocks, with investors taking a long-term view of potential profitability in the likes of Flight Centre, Webjet and Corporate Travel.”
Flight Centre advanced 5.68 per cent to $18.22, Webjet added 4.5 per cent to $5.56 and Corporate Travel rose 5.69 per cent to $23.23.
Qantas lifted 3.82 per cent to $5.17, while Regional Express edged 0.36 per cent higher to $1.40.
Mr Piotrowski said it followed a surge in northern hemisphere travel stocks overnight.
PointsBet rallied 9.93 per cent to $7.31, making it the best performing stock in the ASX200, after announcing a partnership with Nasdaq-listed Sportradar.
“After a choppy few days, PointsBet found its feet in time for the punting season,” Mr Tchourilov said.
“Sportradar will provide betting data for a slew of US sporting codes, marking the next step in PointsBet’s manifest destiny in America, as they continue to deploy massive amounts of resources into their presence in the country.
“However, the giant market comes with fierce competition and state governments that charge excessive taxes.
“As reflected in their share price these last 12 months, the return on investment has been slow.
“The addition of Sportradar adds legitimacy to PointsBet’s position and a competitive advantage over others fighting for market share, which will hopefully result in additional operating licenses being granted.”
ANZ gained 1.55 per cent to $27.46, Commonwealth Bank firmed 0.4 per cent to $97.63, National Australia Bank rose 1.07 per cent to $28.34 and Westpac improved 1.11 per cent to $20.95.
Bank of Queensland, which has slumped in recent months, jumped 4.2 per cent to $7.92 after holding its annual general meeting and providing a performance update reaffirming full-year earnings guidance.
“They spoke about margin pressure as well,” Mr Piotrowski said.
“A couple of weeks ago, if you talked about margin pressure, you would have been beaten up a little bit by the market.”
Carsales.com gave an investor day presentation, saying there was “significant upside to come” but eased 1.76 per cent to $25.06.
Bapcor rebounded after being smacked down on Monday on news longstanding boss Darryl Abotomey was bringing forward his planned February 28 exit due to “a marked deterioration” in his relationship with the board.
Shares in the vehicle parts company gained 4.37 per cent to $6.69.
On a similar note, Magellan Financial Group dropped 6.37 per cent to $29.10 after revealing Brett Cairns had resigned, with chief financial officer Kirsten Morton stepping in as interim CEO.
Still on the executive exodus, Bryah Resources announced Neil Marston had resigned as managing director, while Ashley Jones had been appointed CEO.
Shares in the explorer, which also gained a new non-executive director in Brian Davis, rose 4 per cent to 5.2 cents.
Rio Tinto appreciated 0.89 per cent to $94.65, BHP found 0.9 per cent to $39.95 and Fortescue strengthened 1.52 per cent to $17.41.
Healthcare stocks were in favour, with CSL putting on 1.86 per cent to $301.79, Ramsay gaining 2.94 per cent to $68.55 and Sonic improving 1.24 per cent to $43.21.
The Aussie dollar was buying 70.78 US cents, 53.25 British pence and 62.69 Euro cents in afternoon trade.
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