The Australian sharemarket remained buoyant in early afternoon trading, bolstered by gains in the consumer, technology, and healthcare sectors. This positive momentum follows Wall Street’s record-setting close. The S&P ASX/200 index climbed 32 points, or 0.4 percent, reaching 8977.9 points, with nine out of eleven sectors showing positive growth.
Healthcare emerged as one of the top-performing sectors, driven by a 3.5 percent surge in ResMed shares. Ramsay Healthcare and Sonic Healthcare also posted gains of 1.4 percent and 0.6 percent, respectively. Meanwhile, industry leader CSL saw a modest increase of 0.4 percent.
Technology and Banking Sectors Show Strength
Technology stocks mirrored the upward trend seen in U.S. tech shares overnight. Accounting software firm Xero rose by 0.7 percent, Life360 advanced 2.5 percent, and WiseTech edged up by 0.1 percent. Banking shares also experienced a midday rally after a mixed start. ANZ led the charge among the big four banks with a 0.7 percent increase, while Commonwealth Bank, NAB, and Westpac each rose by 0.5 percent.
Mining giants also contributed to the market’s positive performance. BHP added 0.4 percent amid ongoing negotiations with China over iron ore exports. Rio Tinto and Fortescue Metals Group saw their shares rise by 0.6 percent and 1.3 percent, respectively.
Wall Street’s Resilience Amid Government Shutdown
Overnight, U.S. stocks edged higher, setting new record highs as technology stocks continued to rise. The S&P 500 increased by 0.1 percent, the Dow Jones by 0.2 percent, and the Nasdaq composite by 0.4 percent. These gains came despite the ongoing U.S. government shutdown, which has delayed key economic reports.
Typically, Thursdays on Wall Street involve investor reactions to the latest unemployment benefits data. However, the shutdown has postponed this week’s jobless claims report. The delay adds uncertainty, particularly as investors hope for a job market slowdown that would encourage the Federal Reserve to continue cutting interest rates without triggering a recession.
“The Fed has been on record that they are very data dependent and the lack of data from public sources is likely to be problematic,” said Brian Rehling, head of global fixed-income strategy at Wells Fargo Investment Institute.
Despite these uncertainties, the U.S. stock market has largely shrugged off the shutdown’s impact, with corporate announcements driving trading activity. Notably, stocks in the chip and artificial intelligence sectors climbed after OpenAI announced partnerships with South Korean companies for its Stargate project.
Buffett’s Major Acquisition and Tesla’s Challenges
In a significant corporate development, Occidental Petroleum’s shares fell 7.3 percent after agreeing to sell its chemical business, OxyChem, to Berkshire Hathaway for $9.7 billion in cash. This acquisition could mark the final major purchase for Berkshire Hathaway under the leadership of renowned investor Warren Buffett.
Meanwhile, Tesla faced challenges despite reporting a record quarter for vehicle sales. The company delivered 497,099 vehicles worldwide, exceeding analysts’ expectations. However, the expiration of federal electric-car subsidies poses a challenge for future sales, leading to a 5.1 percent drop in Tesla’s share price.
By the Numbers: Tesla delivered 497,099 vehicles in the most recent quarter, 7.4 percent more than a year ago, surpassing the 439,600 average analyst estimate.
In the bond market, the yield on the 10-year Treasury note decreased slightly to 4.09 percent from 4.12 percent, reflecting ongoing market adjustments.
The Australian dollar was trading at US65.95¢ at 12:30 pm AEST, maintaining stability in the face of global market fluctuations.
As the week progresses, investors will continue to monitor developments in the U.S. government shutdown and its potential impact on economic data releases. The resilience of both the Australian and U.S. markets highlights their capacity to navigate uncertainties, though the path forward remains closely watched by analysts and investors alike.
