Weekly Wrap: ASX 200 Rises Amid Wall Street Gains but Faces Third Weekly Decline
The Australian share market rose again on Friday but not enough to stop its third weekly fall in a row.
Fresh record highs on Wall Street due to falling interest rates and more technology optimism helped our market to propel higher but we are still well short of our record high close of 9019.1 points set back in August.
Instead, the ASX 200 added 0.3% or 28.3 points, to 8773.5 points, although that still represented a 1% fall for the week.
Broad Base for Rise
At least the end of the week rise was quite well spread with seven of the 11 sectors rising with some pundits still hopeful we could approach record territory once again in the next couple of weeks.
Hopes for a November 3 interest rate cut by Australia’s Reserve Bank might help to push the ASX 200 higher, as long as no pesky statistics come along to make that less likely.
Healthcare Leads the Pack
The strongest ASX sector was healthcare, pushed up by gains with medical diagnostics giant Telix Pharmaceuticals (ASX: TLX) up 6.4% to $14.53 as hopes that the company’s prostate cancer treatment is well on the way to commercial success.
Also rising was shares in imaging software group Pro Medicus (ASX: PME), up 4.9% to $313.29 amid positive broking reports.
There was an unusual occurrence for the big miners with stronger iron ore prices being greeted by falling share prices from the big miners.
BHP (ASX: BHP) were down 0.8% to $39.64 while Rio Tinto (ASX: RIO) fell 1.3% to $114 as it prepared to thin its executive ranks substantially.
Even Fortescue Metals (ASX: FMG) fell 0.2% or 3c to $18.72.
There was more familiar good news among the gold miners with consolidation play Northern Star (ASX: NST) up 1.2% to $20.71 while Evolution Mining (ASX: EVN) were also up 3.2% to $9.50.
Energy Enjoys Day in the Sun
For once the energy sector had a good day with shareholders in former takeover target Santos (ASX: STO) overcoming their disappointment and bidding up the price by 0.5% to $6.77.
Still, the stock has shed 10% for the week after the consortium led by the Abu Dhabi National Oil Company withdrew its takeover bid.
AGL Energy (ASX: AGL) added 0.3% to $8.73 after it scored Federal Government approval for a wind power and battery storage project.
Super Retail Ejects Boss
One of the big stories for the week centred on omnibus retailer Super Retail (ASX: SUL), which runs the Supercheap Auto, Macpac, BCF and Rebel chains.
After staunchly defending its chief executive Anthony Heraghty for more than 16 months over allegations by two senior former company whistleblowers that he was in a relationship with the company’s former head of HR which created a toxic workplace, the board promptly sacked Heraghty for allegedly lying to them about the duration of the relationship.
The whistleblower legal action now appears to be a question of “how much” while the company shares fell 4.8% for the week.
The Week Ahead
There are plenty of important releases to watch out for in the coming week with the main ones being local and US measures of inflation.
Here inflation as measured by the trimmed mean is expected to land almost in the centre of the Reserve Bank’s target zone of 2% to 3% at 2.5%.
Before those numbers are released on Wednesday, RBA governor Michele Bullock will be appearing before the House of Representatives economic committee and will no doubt be doing her best not to tip her hand on when the RBA might next consider cutting official interest rates.
November Cut Tipped
The bond market is betting on the November 3-4 meeting for the next cut but the end of September is much less likely but not entirely out of the question.
For the US, the Federal Reserve’s preferred inflation measure, the personal consumption expenditure (PCE), is expected to increase by 0.2% in August with the annual rate set to stay around 2.9%.
It is a tough figure to read though, with the gathering tariff collections set to keep upward pressure on prices and inflation, even if it turns out to be a one-off effect, which is by no means a certainty.
On the company front, retailer Myer (ASX: MYR) is expected to reveal an earnings update on Tuesday.