ASX200 Afternoon Report June 20, 2023
Your ASX200 afternoon report.
The ASX200 trades 68 points (0.90%) higher at 7363 at 4.00 pm.
With US equity markets closed overnight for the Juneteenth holiday, the ASX200 has today taken its lead from action from Chinese authorities to stimulate its flagging economy. The rally has been broad-based, with all eleven sectors trading higher.
The People's Bank of China's (PBoC's) reduction of the 1-year medium-term lending facility (MLF) last week was replicated by cuts this morning of a similar magnitude to the one-year and the five-year Loan Prime Rate (LPR). While more needs to be done to revive the Chinese economy, recent rate cuts signal a change in policy direction by authorities and are likely to be followed by further easing measures in the weeks ahead.
The energy sector has led today’s rally. Heavyweight Woodside gained 2.34% to $36.35 after it confirmed that an oil project off the Mexican coast would proceed. AGL added 2.84% to $11.05, Santos added 2.38% to $7.75, and Strike Energy added 2.15% to $0.48c.
The prospect of more stimulus in China buoyed the mining behemoths. BHP added 1.54% to $46.81, Rio Tinto added 0.83% to $117.61, Mineral Resources added 0.6% to $73.82, while Fortescue added 0.5% to $22.45.
The release of the Reserve Bank of Australia (RBA) meeting minutes this morning noted that members discussed two options at the June meeting - increasing the cash rate by 25 basis point (bp) or holding the cash rate unchanged. The more dovish-than-expected minutes have supported the financial sector. NAB added 1.61% to $26.48, Westpac added 1.47% to $21.46, CBA added 1.2% to $101.70, and ANZ added 0.72% to $23.79.
A mixed day for the Lithium sector as Lake Resources plunged over 20% for a second day running to $0.29c after noting yesterday that its project in Argentina would be delayed by six years and cost around twice as much as initially expected. Elsewhere Iluka added 2.36% to $11.70, Pilbara Minerals added 2.3% to $4.93, and IGO added 2.2% to $15.23. The rises in the latter two following a broker upgrade.
After seven straight sessions of gains, including a break above critical resistance at 7250 coming from the downtrend from the February 7567 high, the ASX200 is eyeing the April 7391 high. A sustained break above 7390 would open the way for a push to the year-to-date (YTD) high at 7567.
The AUD/USD is trading at .6802 (-0.68%), consolidating after its almost 7% rally over the past 11 sessions.
IGA, may distribute information/research produced by its respective foreign affiliates within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.
The information/research herein is prepared by IG Asia Pte Ltd (IGA) and its foreign affiliated companies (collectively known as the IG Group) and is intended for general circulation only. It does not take into account the specific investment objectives, financial situation, or particular needs of any particular person. You should take into account your specific investment objectives, financial situation, and particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit.
No representation or warranty is given as to the accuracy or completeness of this information. Consequently, any person acting on it does so entirely at their own risk. Please see important Research Disclaimer.
Please also note that the information does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Any views and opinions expressed may be changed without an update.
Take a position on indices
Deal on the world’s major stock indices today.
- Trade the lowest Wall Street spreads on the market
- 1-point spread on the FTSE 100 and Germany 40
- The only provider to offer 24-hour pricing
Live prices on most popular markets
- Forex
- Shares
- Indices
See more forex live prices
See more shares live prices
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.
See more indices live prices
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 20 mins.
