AU Morning Wrap: Resources Stocks Rally on Higher Oil, Iron Ore Prices

Moomoo News AU wrote a column · Jun 4, 2023 19:22

G'day, mooers! Check out the latest news on today's stock market!
• NASDAQ inflows surge as tech FOMO trade returns
• ASX rallies 1% at the open
• Stocks to watch: BHP, Karoon Energy, Elders
- Moomoo News AU

AU Morning Wrap: Resources Stocks Rally on Higher Oil, Iron Ore Prices

Wall Street Summary

Major stock indexes climbed Friday on the back of a jobs report that blew past Wall Street expectations, signaling that hiring remains robust even as other data suggests inflation continues to slow. It added momentum to a market already bouncing from Washington's 11th-hour deal to avert a government default.

The $Dow Jones Industrial Average(.DJI.US)$ jumped about 2.1% Friday, or more than 700 points, its best session of the year and enough to claw back recent days' losses to finish the week in the green. The $S&P 500 Index(.SPX.US)$ edged 1.5% higher, while the technology-heavy $Nasdaq Composite Index(.IXIC.US)$ rose 1.1% to its sixth-straight weekly gain and a 52-week high.

AU Market Watch

The $S&P/ASX 200(.XJO.AU)$ jumped 1 per cent, or 72.9 points, to 7218 in the opening minutes of trade, buoyed by a rally across the energy and materials sectors.

The major miners jumped following a rally in iron ore prices last week amid hopes of new policy measures to support China's property sector; $Fortescue Ltd(FMG.AU)$ rose 2.1 per cent to $20.10, $BHP Group Ltd(BHP.AU)$ added 2.3 per cent to $44.24 and $Rio Tinto Ltd(RIO.AU)$ firmed 2 per cent to $112.35.

Energy stocks advanced on higher oil prices after Saudi Arabia said it would make an extra 1 million barrel-a-day supply cut next month; $Karoon Energy Ltd(KAR.AU)$ climbed 2.4 per cent to $2.10 and $Woodside Energy Group Ltd(WDS.AU)$ rose 1.8 per cent to $35.17.

$Elders Ltd(ELD.AU)$ climbed 6.3 per cent to $6.78 on news that chief executive Mark Allison will continue in his role.

$Myer Holdings Ltd(MYR.AU)$ firmed 1 per cent to 68.2¢ after announcing that chief executive John King will retire from his role in the second half of calendar 2024.

Stocks to Watch

$Evolution Mining Ltd(EVN.AU)$: Evolution Mining has approved capital investment of $250 million for the expansion of its Mungari plant from 2 million tonnes to 4.2 million tonnes a year following completion of the feasibility study.

Evolution said the feasibility study demonstrated a "compelling investment case" with an internal rate of return ranging from 19 per cent to 28 per cent at a conservative $2400 an ounce and spot price of $2965 an ounce respectively, a mine life of about 15 years, and an 18 per cent reduction in all-in sustained costs (AISC) to $1750 per ounce.

$Myer Holdings Ltd(MYR.AU)$: Myer chief executive John King will retire from his role in the second half of calendar 2024 and will return to the US.

The company said the decision was based on King being with his family as their health circumstances demand.

$AGL Energy Ltd(AGL.AU)$: AGL Energy has been served with class action proceedings filed in the Federal Court of Australia.

The proceedings allege breaches of section 46 of the Competition and Consumer Act 2010 relating to bidding in the South Australian Region of the National Electricity Market.

"AGL takes its compliance obligations seriously and intends to vigorously defend the proceedings," the company said.