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Australian sharemarket on four-day winning streak as global sentiment improves, Omicron fears wane

Rebecca Le MayNCA NewsWire
The Australian sharemarket took off like a rocket, recording its strongest result in four straight days of gains, buoyed by optimism in US and European markets. James Gourley / NCA NewsWire
Camera IconThe Australian sharemarket took off like a rocket, recording its strongest result in four straight days of gains, buoyed by optimism in US and European markets. James Gourley / NCA NewsWire Credit: News Corp Australia

The Australian sharemarket took off like a rocket, recording its strongest result in four straight days of gains, buoyed by optimism in US and European markets.

Unlike recent choppy sessions, it was a pretty steady trajectory higher, until a last minute pullback, with the benchmark S&P/ASX200 index finishing 1.25 per cent stronger at 7405.4, while the All Ordinaries Index rallied 1.34 per cent to 7707.2.

CommSec analyst Tom Piotrowski said newsflow was thin but generally, sentiment had improved on global markets.

OMG chief executive Ivan Tchourilov said the bounce back from initial Omicron fears continued, pushing the ASX200 back to the upper end of its price range over the past three months.

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“It’s yet to break out, however if the run can continue, we would hope to see it back at the 7450 mark before Christmas,” he said.

IG market analyst Kyle Rodda said traders seemed to be taking it as given that Omicron was “of about as much economic significance as a head cold”.

“Such ebullience seems a bit premature based upon what’s only some crude data right now, along with a vague assurance from Pfizer that its vaccine is partially effective against the new variant,” he said.

“But misguided or not, it’s ‘risk on’ in markets.”

Mr Tchourilov said small caps and tech stocks were still climbing, with buy-now-pay-later companies enjoying a resurgence after a tough last quarter of the year.

Zip surged 10.9 per cent to $5.29 after Tuesday’s trading update found favour with brokers.

“It was only a couple days ago that this organisation got quite the towelling up and fell away by the most part of 10 per cent,” Mr Piotrowski said.

“Yesterday it was up by about 10 per cent on the back of some encouraging numbers.”

Among other BNPL stocks, Afterpay jumped 4.24 per cent to $99.79, Sezzle advanced 6.53 per cent to $3.59 and Splitit gained 2.04 per cent to 25 cents, but Laybuy shed 5.4 per cent to 17.5 cents.

“Materials paced the market, with heavy lifting coming from metal miners,” Mr Tchourilov said.

“Iron ore jumped overnight, sitting comfortably above $US110 per tonne.

“News that China will be easing monetary policy to support economic growth was welcomed by the market, with the expectation that steel mill output caps will be eased, too.

“The sentiment was extended to our energy sector, which will provide oil and gas to fuel the growth.”

Rio Tinto rose 2.18 per cent to $96.71, BHP gained 1.85 per cent to $40.69, Fortescue lifted 3.27 per cent to $17.98 and Mount Gibson Iron surged 10.96 per cent to 40.5 cents.

Iron ore and lithium producer Mineral Resources leapt 5.85 per cent to $47.07.

Santos gained 2.28 per cent to $6.73, Oil Search added 2.19 per cent to $4.20 and Woodside improved 2.1 per cent to $22.40.

Woodside provided an investor update, unveiling a new target to invest $US5bn ($A7bn) in emerging energy markets by 2030.

Chief executive Meg O’Neill said the company sought to be “an early mover” in the evolving market and support the decarbonisation goals of its customers.

“We have a vision to build a low cost, lower carbon, profitable, resilient and diversified portfolio,” she said.

It comes after environmental groups protested against Woodside’s recent decision to proceed with the massive Scarborough gas project in Western Australia’s Pilbara region.

Strike Energy jumped 9.68 per cent to 17 cents after providing a positive update on its Walyering-5 gas well and exploration and appraisal activities in its central Perth Basin acreage.

Gulf of Mexico-focused Byron Energy galloped 9.52 per cent higher to 11.5 cents.

Another strong performer was Mesoblast, which soared 10 per cent to $1.76 and was the second best performer in the top 200.

“There hasn’t been any information out today, but they have had an encouraging update recently in relation to their heart drug treatment,” Mr Piotrowski said.

“That’s making some waves … the clinical data that they have been talking about.”

ANZ lifted 0.73 per cent to $27.66, Commonwealth Bank added 0.33 per cent to $97.95, National Australia Bank rose 1.02 per cent to $28.63 and Westpac gained 0.57 per cent to $21.07.

Travel stocks were mixed after recent gains, with Qantas three cents lower at $5.14, Corporate Travel Management appreciating 1.5 per cent $23.58, Webjet easing 0.72 per cent to $5.52 and Flight Centre dropping 1.26 per cent to $17.99.

The Aussie dollar was fetching 71.3 US cents, 53.78 British pence and 63.13 Euro cents in afternoon trade.

Originally published as Australian sharemarket on four-day winning streak as global sentiment improves, Omicron fears wane

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