Doug Goodwille from Kayne Anderson speaks to Drew Meredith from The Inside Network on market thinkers.
While a surging gold price is on hold as the world adjusts to a Trump presidency, all the factors that saw its price rise more than 50 per during his first term in office – trade disputes, fiscal deficits and geopolitical tensions – are almost certainly guaranteed the second time around.
Firming iron ore steels Australian market
Rising iron ore prices helped mining heavyweights BHP Group, Rio Tinto, Fortescue Metals and Mineral Resources on Thursday, and in turn that helped to push the major indices higher. The benchmark S&P/ASX200 index finished Thursday up 3.8 points at 7,255.4, while the broader All Ordinaries gained 3.9 points to 7,460.
Iron ore has risen 15 per cent since the start of 2023, on optimism around China’s reopening and renewed government support for the country’s construction industry. On the back of that optimism, the materials sector index surged 2.9 per cent on Thursday, with energy being the only other sector to gain, advancing 1.4 per cent.
BHP Group rose $1.83, or 4 per cent, to $48.05; Rio Tinto gained $4.81, or 4 per cent, to $124.44; Fortescue Metals spiked 94 cents, or 4.3 per cent, to $23.06; and Mineral Resources, which mines iron ore and lithium, added $4.03, or 4.7 per cent, to $90.03.
In lithium, Allkem rallied 23 cents, or 1.9 per cent, to $12.10, but fellow producer Pilbara Minerals eased 2 cents, or 0.5 per cent, to $4.08, while IGO, which produces nickel as well as lithium, lifted 35 cents, or 2.6 per cent, to $13.92. Among the lithium project developers, Lake Resources retreated 2 cents, or 3.2 per cent, to 60 cents, and Liontown Resources gained 3.5 cents, or 2.5 per cent, to $1.44.
Among the coal cohort, Whitehaven Coal added 30 cents, or 4.2 per cent, to $7.52; New Hope Corporation gained 24 cents, or 4.4 per cent, to $5.69; Coronado Global Resources put on 4.5 cents, or 2.4 per cent, to $1.92; and Stanmore Resources jumped 13 cents, or 3.7 per cent, to $3.67.
In energy, Woodside Energy advanced 79 cents, or 2.2 per cent, to $37.59; Santos added 5 cents, or 0.7 per cent, to $7.11; and Beach Energy gained 1 cent to $1.44, but Brazilian-based producer Karoon Energy slipped 8 cents, or 3.6 per cent, to $2.16.
Falls among the banks made the financials sector the worst performer, losing 1.9 per cent. ANZ shed 66 cents, or 2.7 per cent, to $23.71; Westpac surrendered 43 cents, or 1.9 per cent, to $21.64; Commonwealth Bank lost $1.98, or 2 per cent, to $97.07; and National Australia Bank was down 55 cents, or 1.9 per cent, to $28.83. Investment bank Macquarie Group lost $4.04, or 2.1 per cent, to $184.86.
US yields firm above 4 per cent
In the US, the broad S&P 500 index added 29.96 points, or 0.8 per cent, to 3,981.35; the 30-stock Dow Jones Industrial Average gained 341.73 points, or 1.1 per cent, to 33,003.57; and the tech-heavy Nasdaq Composite Index lifted 83.5 points, or 0.7 per cent, to 11,462.98. On the bond market, the US 10-year Treasury yield pushed through 4 per cent, up 6.6 basis points, to 4.062 per cent, while the more rate-sensitive 2-year yield was unchanged at 4.889 per cent.
European stock markets closed generally higher, as Eurozone inflation eased to 8.5 per cent.
On the commodities front, gold lost 90 cents to US$1,835.90 an ounce, the global benchmark Brent crude oil grade increased 2 cents to US$84.33 a barrel, and West Texas Intermediate crude advanced 47 cents, or 0.6 per cent, to US$78.16 a barrel.
The Australian dollar is buying 67.28 US cents this morning, down from 67.38 US cents at the local close on Thursday.
