The Australian sharemarket was slightly higher on Tuesday after a rally in gold stocks managed to offset a sell-off in the major banks with local investors cautious ahead of the release of key monthly inflation data.
The S&P/ASX 200 Index rose 0.1 per cent, or by 11.9 points to 8537 at the closing bell, with just four of the 11 sectors finishing in the green. That’s after a 1.3 per cent rally on Monday and a 1.7 per cent jump in the S&P 500, buoyed by hopes that the US Federal Reserve will cut interest rates next month.
IG analyst Tony Sycamore said the lack of “follow through” buying from positive movements on Wall Street was not surprising in the current climate.
“Since mid-September, strong Monday gains on Wall Street have frequently been followed by softer price action through the remainder of the week – a trend that the local market has become attuned to,” he said.
Taking stock
The mining sector rallied on a higher gold price driven by a growing conviction in the bond market that the Fed will cut interest rates next month. Bullion climbed 1.7 per cent near $US4130 an ounce.
Northern Star gained 2 per cent to $26.29, Newmont 4.3 per cent ro $132.88 and Evolution Mining 3.5 per cent to $11.54.
Iron ore producers were also well bid with Fortescue finishing up 2.7 per cent to $21. Rio Tinto gained 2.3 per cent to $132.28.
The rate sensitive tech sector was also higher, tracking a strong rally on Wall Street. Family tracking device Life360 soared 6.6 per cent to $41.67.
Elsewhere, investors were taking stock ahead of the first complete monthly inflation data from the Australian Bureau of Statistics on Wednesday, which shifts reporting from quarterly to monthly. Markets expect inflation to rise from 3.2 per cent at the end of the September quarter to 3.6 per cent.
Ahead of the data, a bout of profiting hit the financial sector with index heavyweight Commonwealth Bank dropping 1.2 per cent to $153.14 while ANZ, National Australia Bank and Macquarie posted more modest losses.
Stocks in focus
In company news, Ramsay Health Care jumped 12.7 per cent to $35.95 after reporting revenue and earnings for the first quarter that beat market expectations. The hospital operator also flagged higher earnings this year.
DroneShield surged 14.6 per cent to $2 after the controversial defence company won a $5.2 million contract from an existing customer to supply an unnamed European military.
Web Travel soared 9.3 per cent to $4.37 after reporting a 22 per cent jump in total transaction value to $3.2 billion.
SRG Global jumped 6.4 per cent to $2.84 after the engineering group secured $650 million worth of contracts across Australia and New Zealand.
And Iress fell 5.9 per cent to $9.09 after it dismissed media speculation about a possible acquisition, saying it has “no basis to confirm” reports on potential price or exclusivity terms.
