Tuesday was a similarly strong day for the Australian market, with the S&P/ASX 200 (ASX: XJO) moving within 1% of an all-time high; this despite the incredibly difficult geopolitical backdrop.
RBA ‘losing patience’
That was until the Reserve Bank of Australia delivered its latest board meeting result, and associated explanation. Whilst rates remained on hold at 0.1%, analysts were focused on the removal of the word ‘patience’ from their commentary around inflation and rate hikes, suggesting an increase was imminent.
Despite this, the ASX 200 managed to finish 0.2% higher with seven of the 11 sectors rallying. The highlights were once again the energy and technology sectors, up 2.2% and 3.0%, an intriguing combination given the vastly different growth profiles.
Among the highlights was Mineral Resources Limited (ASX: MIN) with the iron ore and lithium miner gaining 5.7% after announcing ‘unprecedented demand’ for lithium and a potential doubling of its production facility in WA.
Other highlights were Block Inc (ASX: SQ2) and accounting platform Xero Limited (ASX: XRO), which gained 6.2% and 4.5%, respectively.
ASX energy and utilities gain
The energy and related utility sectors continue to drive the market higher, likely due to the potential for further sanctions on Russia and further complications around oil and gas supplies.
Origin Energy Ltd (ASX: ORG) and AGL Energy Limited (ASX: AGL) were local beneficiaries, gaining 3.1% and 2.6% each.
Qantas flag removed
The three-year probe into Qantas Airways Limited (ASX: QAN) regarding the competitive threat of its 19.9% investment in Alliance Aviation Services Ltd (ASX: AQZ) was dropped without any action taken against the company; shares were flat on the news.
IGO takeover under pressure
IGO Ltd (ASX: IGO), formerly Independence Group, is facing a hurdle in its proposed acquisition of nickel miner Western Areas Ltd (ASX: WSA) with shares falling more than 2% after the target company received an independent valuation suggesting the deal was significantly undervaluing it. This comes after an incredible surge in the price of nickel due to the events in Ukraine.
Shares in the major ASX iron ore miners reversed recent gains, even though a continued surge and higher prices for Chinese steel have seen the iron ore price bid up beyond US$160 once again.
ASX 200 today
Looking ahead, the ASX 200 is set to open lower this morning, following a negative lead from US stock markets overnight. The Nasdaq fared the worst, falling more than 2%. To find out more, check out my US stock market report.
