ASX200 Afternoon Report May 18th 2022
The ASX200 is trading 60 points higher at 7173 at 3.15 pm, looking to lock in a fourth straight day of gains after a wicked rebound on Wall Street overnight.
Share this:
The ASX200 is trading 60 points higher at 7173 at 3.15 pm, looking to lock in a fourth straight day of gains after a wicked rebound on Wall Street overnight.
The rally on Wall Street came after robust retail sales data helped ease fears of a growth slowdown. Despite hawkish comments from Fed Chair Powell, who noted that inflation is the priority and that financial conditions have already "tightened quite a bit".
In recent weeks this type of hawkish Fed speak would have knocked the lights out of the market; however, after its sharp repricing lower, valuations now reflect an expectation that U.S yields will be in the 3.0-3.25% range by March 2023.
Shaking off news of fresh Covid-19 outbreaks around key Chinese cities, the Materials sector has helped drive the index higher.
South 32 (S32) added 5.26% to $4.71, Mineral Resources (MIN) added 2.5% to $60.66, Oz Minerals (OZL) added 3.5% to $22.80, Lynas Rare Earths (LYC) added 3.13% to $972. BHP Group (BHP) added 3.07% to $46.97, Rio Tinto (Rio) added 2% to $108.91. Fortescue Metals (FMG) added 1.70% to $19.72.
A strong rally in the Nasdaq overnight has helped the local IT sector higher. Seek (SEK) added 4.4% to $25.39, Life 360 (360) added 3.14% to $3.61, Megaport (MP1) added 2.56% to $7.23, Wisetech Global (WTC) added 2% to $41.21, Altium (ALU) added 1.9% to $28.10 and Afterpay owner Block (SQ2) added 1.94% to $117.50. BNPL stock Zip (ZIP) fell 1.9% to fresh cycle lows at $0.90c.
Consumer Discretionary stocks have climbed despite a tepid Q1 2022 Wages print which rose to 2.4% for the year, significantly below the inflation rate of 5.1%. Real wages - adjusted by headline inflation - are down 2.6% over the past year.
Flight Centre (FLT) added 4.55% to $21.16, Dominoes Pizzas (DMP) added 2.86% to $70.19, Webjet (WEB) added 1.95% to $5.76, and Harvey Norman (HVN) added 1% to $4.59.
The ASX200 Financial Sector has edged sideways. ANZ added 1.09% to $25.89, Macquarie (MQG) added 0.84% to $182.01. Westpac (WBC) added 0.1% to $24.48. Commonwealth Bank (CBA) added 0.05% to $105.17. National Australia Bank (NAB) fell by 0.57% to $31.30.
The rebound in Lithium names has extended again today. Lake Resources (LKE) added 3.1 % to $1.51. Galan Lithium (GLN) added 3.5% to $1.48. Pilbara Minerals (PLS) added 2.4% to $2.80. Allkem (AKE) added 2.16% to $12.32. Iluka Resources (ILU) added 1.7% to $10.16.
Brambles (BXB) shares have bounced by 3.7% to $11.12 after CVC walked away from the pallet and distribution company yesterday.
Boral (BOR) has fallen by 3.12% to $3.11 after it warned of a $45m hit to FY22 earnings due to heavy rain in NSW and Queensland as well as rising energy costs.
Turning to the charts, after the ASX200 reached our 7000/6950ish downside target last week, we called for a recovery towards 7200. From broadly within the 7200/7300 region, we would ideally like to see one more leg lower towards range lows 6950/6750. But let's see what this weekend's Federal Election brings before making any new calls.
Source Tradingview. The figures stated are as of May 18th, 2022. Past performance is not a reliable indicator of future performance. This report does not contain and is not to be taken as containing any financial product advice or financial product recommendation
How to trade with City Index
You can trade with City Index by following these four easy steps:
- Open an account, or log in if you’re already a customer
• Open an account in the UK
• Open an account in Australia
• Open an account in Singapore
- Search for the company you want to trade in our award-winning platform
- Choose your position and size, and your stop and limit levels
- Place the trade
The ASX200 is trading 60 points higher at 7173 at 3.15 pm, looking to lock in a fourth straight day of gains after a wicked rebound on Wall Street overnight.
The rally on Wall Street came after robust retail sales data helped ease fears of a growth slowdown. Despite hawkish comments from Fed Chair Powell, who noted that inflation is the priority and that financial conditions have already "tightened quite a bit".
In recent weeks this type of hawkish Fed speak would have knocked the lights out of the market; however, after its sharp repricing lower, valuations now reflect an expectation that U.S yields will be in the 3.0-3.25% range by March 2023.
Shaking off news of fresh Covid-19 outbreaks around key Chinese cities, the Materials sector has helped drive the index higher.
South 32 (S32) added 5.26% to $4.71, Mineral Resources (MIN) added 2.5% to $60.66, Oz Minerals (OZL) added 3.5% to $22.80, Lynas Rare Earths (LYC) added 3.13% to $972. BHP Group (BHP) added 3.07% to $46.97, Rio Tinto (Rio) added 2% to $108.91. Fortescue Metals (FMG) added 1.70% to $19.72.
A strong rally in the Nasdaq overnight has helped the local IT sector higher. Seek (SEK) added 4.4% to $25.39, Life 360 (360) added 3.14% to $3.61, Megaport (MP1) added 2.56% to $7.23, Wisetech Global (WTC) added 2% to $41.21, Altium (ALU) added 1.9% to $28.10 and Afterpay owner Block (SQ2) added 1.94% to $117.50. BNPL stock Zip (ZIP) fell 1.9% to fresh cycle lows at $0.90c.
Consumer Discretionary stocks have climbed despite a tepid Q1 2022 Wages print which rose to 2.4% for the year, significantly below the inflation rate of 5.1%. Real wages - adjusted by headline inflation - are down 2.6% over the past year.
Flight Centre (FLT) added 4.55% to $21.16, Dominoes Pizzas (DMP) added 2.86% to $70.19, Webjet (WEB) added 1.95% to $5.76, and Harvey Norman (HVN) added 1% to $4.59.
The ASX200 Financial Sector has edged sideways. ANZ added 1.09% to $25.89, Macquarie (MQG) added 0.84% to $182.01. Westpac (WBC) added 0.1% to $24.48. Commonwealth Bank (CBA) added 0.05% to $105.17. National Australia Bank (NAB) fell by 0.57% to $31.30.
The rebound in Lithium names has extended again today. Lake Resources (LKE) added 3.1 % to $1.51. Galan Lithium (GLN) added 3.5% to $1.48. Pilbara Minerals (PLS) added 2.4% to $2.80. Allkem (AKE) added 2.16% to $12.32. Iluka Resources (ILU) added 1.7% to $10.16.
Brambles (BXB) shares have bounced by 3.7% to $11.12 after CVC walked away from the pallet and distribution company yesterday.
Boral (BOR) has fallen by 3.12% to $3.11 after it warned of a $45m hit to FY22 earnings due to heavy rain in NSW and Queensland as well as rising energy costs.
Turning to the charts, after the ASX200 reached our 7000/6950ish downside target last week, we called for a recovery towards 7200. From broadly within the 7200/7300 region, we would ideally like to see one more leg lower towards range lows 6950/6750. But let's see what this weekend's Federal Election brings before making any new calls.
Source Tradingview. The figures stated are as of May 18th, 2022. Past performance is not a reliable indicator of future performance. This report does not contain and is not to be taken as containing any financial product advice or financial product recommendation
- Open a Forex.com account, or log in if you’re already a customer.
- Search for the pair you want to trade in our award-winning platform.
- Choose your position and size, and your stop and limit levels.
- Place the trade.
Related tags:
Latest market news
Open an account in minutes
Experience award-winning platforms with fast and secure execution, and enjoy tight spreads from 0.5 pts on FX and 0.3 pts on indices.
Economic calendar
Web Trader platform
Our sophisticated web-based platform is packed with features.
Related articles
ASX 200 Slides as Oil, Yields and Rate Risks Hit Sentiment
The ASX 200 suffered its worst week in six months as surging oil, higher bond yields and renewed rate-hike bets drove a broad risk-off move.
Cyclical stocks sniff out better times ahead
Different economies, different drivers, similar price action. The German DAX, ASX 200 and Russell 2000 are all hinting at a more optimistic view on the global economy.
ASX 200 Outlook: Energy Stabilises, Tech Tests Support
ASX energy and technology stocks show signs of stabilising as traders focus on the key 9,000 level ahead of options expiry.
This report is intended for general circulation only. It should not be construed as a recommendation, or an offer (or solicitation of an offer) to buy or sell any financial products. The information provided does not take into account your specific investment objectives, financial situation or particular needs. Before you act on any recommendation that may be contained in this report, independent advice ought to be sought from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs.
StoneX Financial Pte. Ltd., may distribute reports produced by its respective foreign entities or affiliates within the StoneX group of companies or third parties pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed to a person in Singapore who is not an accredited investor, expert investor or an institutional investor (as defined in the Securities Futures Act), StoneX Financial Pte. Ltd. accepts legal responsibility to such persons for the contents of the report only to the extent required by law. Singapore recipients should contact StoneX Financial Pte. Ltd. at 6826 9988 for matters arising from, or in connection with the report.
In the case of all other recipients of this report, to the extent permitted by applicable laws and regulations neither StoneX Financial Pte. Ltd. nor its associated companies will be responsible or liable for any loss or damage incurred arising out of, or in connection with, any use of the information contained in this report and all such liability is hereby expressly disclaimed. No representation or warranty is made, express or implied, that the content of this report is complete or accurate.
StoneX Financial Pte. Ltd. is not under any obligation to update this report.
Trading CFDs carries a high level of risk that may not be suitable for some investors. Consider your investment objectives, level of experience, financial resources, risk appetite and other relevant circumstances carefully. The possibility exists that you could lose some or all of your investments, including your initial deposits. If in doubt, please seek independent expert advice. Visit www.forex.com/en-sg/terms-and-policies for the complete Risk Disclosure Statement.