ASX 200 shares post first weekly gain in
Australian stocks advanced 3.9% this week, the first weekly gain this month, as a rebound in commodity prices helped lift investor sentiment.
The S&P/ASX 200 index added 187.5 points over five days to 4,952.8, recording three days of gains during the week.
“Market sentiment improved over the past week and risk assets had a better time. Global equity markets posted solid gains, helped by rising oil prices,” Commonwealth Bank senior economist, Gareth Aird, said in a report on Friday.
“[T]he bears returned to their cave – at least for now.
“Market pricing implies the Fed won’t lift rates this year and to us that looks overdone. There are still plenty of concerns around the global economy. But the US labour market continues to perform well and we expect fears of a collapse in China to recede over the year,” he said.
Mining, energy stocks rise
All sectors within the ASX 200 except telecommunications services posted gains, led by material and energy companies.
The S&P/ASX 200 Materials Index soared 7.7% this week, with BHP Billiton (ASX: BHP) and Fortescue Metals (ASX: FMG) surging 10.1% and 22.8%, respectively.
Iron ore with 62% ferrous content delivered to Qingdao, China, rose to US$47.14 per tonne on Thursday, the highest level since 16 November 2015, according to data compiled by Bloomberg.
A rebound in oil prices supported the S&P/ASX 200 Energy Index, which climbed 6.1% over five days.
WTI crude traded at US$30.53 per barrel at 5:13pm AEDT, up 3.7% from last Friday, according to Bloomberg data. Brent crude was 2.2% higher at US$34.10 a barrel.
Whitehaven Coal (ASX: WHC) had the steepest increase among energy stocks, jumping 24%. WorleyParsons (ASX: WOR) and AWE (ASX: AWE) gained 17.8% and 16.5%, respectively.
Shares in Origin Energy (ASX: ORG) advanced 12.9%, while Santos (ASX: STO) added 7.3%, despite both companies reporting dismal financial results during the week.
Meanwhile, the S&P/ASX 200 Financials Index, which accounted for about 46% of the ASX 200’s weighting, was 4.1% firmer.
The third week of the February earnings reporting season saw several blue chips submitting their report cards.
Australia and New Zealand Banking (ASX: ANZ) posted a 4% rise in cash profit in the first quarter but warned investors of higher credit charges in the first half due to a “difficult” second quarter.
Shares in National Australia Bank (ASX: NAB) rose 6.1% this week after the lender’s first-quarter cash earnings were up 8%.
Other notable companies that delivered higher profits included AMP, CSL, Domino’s Pizza, Medibank Private and Telstra.
Meanwhile, Woodside Petroleum and Insurance Australia Group reported weaker earnings.