ASX rises on US-China chip deal
The benchmark ASX200 index closed up on Wednesday, gaining 10.60 points or 0.13 per cent to 8,279.60.
The broader All Ordinaries also traded higher on Wednesday, gaining 9.50 points or 0.11 per cent to 8,520.20 and setting a new 50-day high.
The Australian dollar continued its steady rally up 0.05 per cent to 64.76 US cents.
On a mixed day six of 11 industry sectors ended in the green, leading the risk on part of the market including energy and technology. Australia's market continues to eke out small gains. Photo: Gaye Gerard / NewsWire Credit: News Corp Australia
Helping to lead the rally was the buy now pay later shares, with Zip up 5.29 per cent to $2.09 while Block closed up 6.30 per cent to $90.35.
The more defensive part of the market including consumer defensive, healthcare and utilities all finished in the red.
Origin Energy fell 1.1 per cent to $10.98, APA Group dropped 1.3 per cent to $8.16 and AGL dipped 3.45 per cent to $10.36.
The two major supermarkets finished in the red. Woolworths shares fell 0.16 per cent to $31.51 while Coles dropped 0.88 per cent to $21.33.
Morningstar equity market strategist Lochlan Halloway said the Australian gains followed a strong showing on Wall Street session overnight on the back of the tech sector continuing its rally overnight.
Nvidia was one of the main drivers, up 5.6 per cent on the back of US President Donald Trump allowing the chip maker to send its artificial intelligence microchips to China.
'It is always constructive to look into the US and a lead into what might happen in our market. It was a fairly strong showing on the US, particularly in the tech sector with the Nasdaq up nearly 2 per cent overnight,' Mr Halloway said.
'That was primarily due to further deregulation with Trump's tariffs, including chip restrictions and that spilt over into Australia's tech sector today.' On a mixed day six of the 11 sectors finished in the green. Picture NewsWire/ Gaye Gerard. Credit: News Corp Australia
'The strongest was energy, which is sort of a global growth proxy sector. Oil was up, again reflecting de-escalating trade tensions and a more optimistic outlook for global growth.'
In company news Australia's largest bank has announced bumper quarterly cash profits, but its boss warns global uncertainty could soon slow the Australian economy.
Commonwealth Bank revealed its cash profits rose 6 per cent to $2.6bn in the March quarter, on the back of strong lending to Australian businesses.
The bank said business loans surged 9.1 per cent or $3.7bn within those three months, outpacing its home-lending volumes which grew 4.1 per cent.
Importantly for shareholders, CBA said its net interest margin – a key measure of profitability – held stable in the quarter, excluding non-recurring earnings, although it did not provide the figure in its trading update.
CBA finished Wednesday up 0.82 per cent to $167.50, ANZ finished narrowly in the green up 0.070 per cent to $28.53, NAB jumped 1.38 per cent to $36.10 and Westpac was the outlier down 1.20 per cent to $31.26.
Life 360 also continued its impressive run up 9.46 per cent on Wednesday to $29.75 after releasing its quarterly earnings on Tuesday, which beat market expectations.
Insignia shares tumbled 15.75 per cent to $3.37 after it announced Bain Capital said it was walking away from its $3.4bn takeover on 'macro uncertainty'.
Gaming company Aristocrat also slumped 8.85 per cent to $62.10 after posting its half-yearly results which underwhelmed the market.
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7NEWS
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While the aircraft won't deploy nuclear weapons while based here, Tanter warned that this action was a shift in Australia's role. 'This is a step from communications and control to deployment,' he said. 'Refuelling tankers will be based here, and Australian fighter jets will be providing escort cover.' 'We are part of the deployment system.' 'You don't necessarily need to have the bomb here to be in the nuclear command structure.' Strategic target in world war Inclusion of Australia within US military bases also makes it a potential target in a global war. 'China will understandably interpret Australia's deepening defence ties with the US as a threat to its own interests, will not approve of this position, and seek to consistently denounce it as destabilising,' Wilkins said. On the other hand, Tanter said we are not likely to face a threat from Iran. 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'The lack of psychological and material preparation for a major conflict in Australia at the present time ensures that war will be more costly to the nation than otherwise, again mirroring the experience of the Allies in the first part of the Pacific War.' Conscription technically possible Tanter believes that conscription could be reinstated in the event of a large war, although politically it is impossible. 'It's just a matter of decision and law,' he said. 'But the way the conscription worked back in the Vietnam War, it was highly unpopular, and conscripts were not particularly suited for most combat opportunities.' Room for independent policy shrinking Australia has some room for independent decision-making in conflicts involving the US, but this would come at significant political cost. 'In the event of a US-China war, Australia could act independently, but probably only at the cost of the alliance,' Tanter said. Australia has already locked itself into a subordinate role, he said. 'We've chosen to be technologically tied to the Americans, which restricts our options.' Moral questions remain Australia's alliances raise tough moral questions as tensions escalate. Tanter was critical of the Australian role in global conflicts and the broader narrative about defending a 'rules-based order'. 'There are no clean hands here,' he said, referencing recent conflicts such as the war in Gaza. 'The US and Israel are engaged in what I regard as ethnic cleansing or genocide.' 'In those circumstances, I think we need to have a policy like the Whitlam government had in 1973 — that we don't take sides.' As tensions rise globally, Australia's path may already be set — not by choice, but by alliance.
