Based on an analysis by Equithy senior account manager David Frenkel, overnight economic data raised hopes among Australian investors that the current rate hike cycle will end. As a result, the ASX200 finished the day higher by about 0.55 percent. It was up by 29.90 points, going at 7,323. The All Ordinaries index, which is represented by XAO, increased by 41.5 points, reaching 7,538.2.
Economic data from the United States show a meager 0.2 percent increase in retail trade figures. This value is much lower than predicted, indicating that the rate hikes are cutting down on spending. At the same time, industrial production decreased for the second month in a row.
Out of 11 sectors covered by the ASX, nine finished up on July 19. The only low performers were telecommunication and mining companies. The biggest gain on Wednesday was the energy sector, which saw an overall increase of 1.7 percent after getting production updates from two major companies.
Energy and Banking Sectors End The Day Higher
One of these is Woodside Energy, which rose by 1.4 percent to reach a price of $36.05. The oil and gas company said that their full-year guidance remains unchanged, which resulted in a surge despite the recent decrease in June quarter production rates.
Ampol reported that fuel sales increased by 13 percent in the past half-year, which allowed it to grow by 4.4 percent and reach a price of $31.14.
The banking sector showed impressive performance as all four of the bigger banks on the index closed the day higher. Among these, ANZ and CBA grew by 2 percent to $25.46 and $104.65, marking a five-month high. Westpac rose to $22.06 as it gained 2.1 percent, while NAB saw an increase of 1.1 percent at $27.98.
Mining Sector Underperforms
Unfortunately, companies in the mining sector, such as Northern Star, finished lower at 5.8 percent. The company reached a 10-day low as prices plummeted to $12.59. This comes after the mining company said that it reached its production and sales targets, but costs were considerably higher than expected.
Not to mention, it could only forecast modest growth for the upcoming fiscal year. Equithy senior account manager David Frenkel reports that the soft guidance for the upcoming fiscal year was a critical factor behind investors’ decisions.
Rio Tinto Dips Despite Impressive Projections
Another mining company, Rio Tinto, announced that its iron ore shipments would fall along the higher end of estimates but still fell by 0.7 percent to $116.01. Fortescue saw a decrease of 1.9 percent, and BHP fell by 0.3 percent to $22.29 and $44.67, respectively.
Impressively, Mt Gibson Iron surged by 9 percent to $0.48 after announcing that its full-year sales had gone above guidance levels.
Immunotech, a biotech company, and Brainchip, an artificial intelligence chip company, were awarded US patents on their technology. As a result, they increased by 12.9 and 7.8 percent. According to Equithy’s David Frenkel, such impressive growth is an indication that investors are feeling optimistic about the current rate hike coming to a halt.