ASX rises, powered by consumer stocks, banks; Endeavour bounces back

By Emma Koehn

Australian shares opened higher on Thursday, with consumer stocks and banks strong out of the blocks in the first minutes of trading.

The S&P/ASX200 rose 0.5 per cent to 7,362.200 as of 10:15am AEST, with utilities the only sector in the red as blue-chip stocks rallied.

Wall Street has continued to climb.
Wall Street has continued to climb. Credit: Reuters

BHP lifted by 0.6 per cent after raising its iron ore output forecast for this financial year, while CSL was 0.7 per cent stronger at the open and insurer QBE posted early gains of 2.4 per cent.

Bottle shop Dan Murphy’s and ALH Hotels operator Endeavour Group jumped 3.6 per cent to $6.10 after the company said it would be moving early to implement regulatory changes proposed by the Victorian government this week such as shorter operating hours for its gaming areas and a $100 cash load limit for pokies.

Shares in Michael Hill International were flat at 92 cents after a trading update revealed the jewellery company’s second-half sales will be down just 0.8 per cent on last year – a better-than-expected result given the cost-of-living pressures consumers are facing.

Consumer discretionary stocks rose in the first half hour of trading, with the sector ahead by 0.6 per cent, powered by gains of 0.6 per cent at Wesfarmers.

Coles Group shares opened 0.5 per cent stronger, even though Australia’s consumer watchdog raised concerns about its proposed acquisition of two milk processing facilities from Canadian-owned Saputo Dairy Australia for $105 million. The ACCC is concerned that the acquisition would strengthen Coles’ position in the dairy supply chain and see Saputo exit the NSW milk market, which would reduce competition and cut prices farmers receive for raw milk.

The local sharemarket gains came after another strong session on Wall Street overnight.

The S&P 500 rose 0.2 per cent for its seventh gain over the last eight days. It’s now up nearly 19 per cent for the year so far and at its highest level in more than 15 months. The Dow Jones gained 0.3 per cent and the Nasdaq composite edged up by less than 0.1 per cent.


Insurance company Elevance Health helped lead the US market, climbing 4.4 per cent after it reported stronger profit and revenue for the Northern Hemisphere spring than analysts had expected and raised its profit forecast for the full year.

Stocks also broadly got a boost from easing pressure from the bond market. Yields there were holding steady or falling after a report showed UK inflation cooled by more than expected. It eased to 7.9 per cent in June, a 15-month low.

The UK data follows encouraging US reports that have raised hope inflation is moderating enough to convince the Federal Reserve to halt its hikes to interest rates soon. That could help the world’s largest economy avoid a long-predicted recession.

The pressure caused by high rates has already helped cause the failures of several US banks, which saw customers suddenly flee in flocks. Other smaller and midsized banks have since been under heavy scrutiny by investors, and they’re beginning to report their latest results.

Western Alliance Bancorp bounced from an early loss to a gain of 7.8 per cent after reporting weaker profit for the latest quarter than analysts expected. It also said customers added $3.5 billion in deposits from April through June.

US Bancorp rose 6.5 per cent after reporting weaker profit than expected but slightly stronger revenue. It also said its deposits grew 3.2 per cent from earlier this year.

Investment banking giant Goldman Sachs added 1 per cent after it fell short of profit expectations for the latest quarter but topped forecasts for revenue.

One of Wall Street’s biggest winners was Carvana, which soared 40.2 per cent. The used-car dealer agreed with its creditors to reduce its debt by more than $US1.2 billion ($1.8 billion). It also reported a milder net loss for the latest quarter than analysts expected.

“Probably the best way to sum up this market at the moment is, ‘can’t stop, won’t stop,’” said JJ Kinahan, CEO of IG North America.

The S&P 500 has already soared 18.9 per cent so far this year as the economy has managed to power through high interest rates, mostly thanks to a remarkably solid job market. Early in the year, much of the market’s gains came from just a small handful of Big Tech stocks, but the gains have broadened out a bit recently as the economy has held up and inflation has cooled more.

In the commodities market, wheat prices surged after Russia launched drone and missile attacks on critical port infrastructure in Ukraine, destroying 60,000 tonnes of grain. The price of soft red winter wheat, traded in Chicago and used for cookies and specialty products, rose 8.5 per cent.

The attacks come days after Russia pulled out of the Black Sea Grain Initiative, which allowed exports from Ukraine to reach many countries facing the threat of hunger.

– with AP

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