The Australian share market has made gains at lunchtime driven by miners and technology stocks, and AMP’s chief executive has resigned.
- ASX opens higher as miners rise on US President’s infrastructure plan
- AMP boss Francesco De Ferrari resigns to be replaced by deputy ANZ chief executive
- Dow Jones fell 0.3pc to 32,982, S&P 500 up 0.4pc to 3,973, and Nasdaq rises 1.5pc to 13,247
The All Ordinaries rose 0.5 per cent to 7,050 at 12:40pm AEDT.
Sanitiser maker Zoono Group jumped 40 per cent after its surface sanitiser was successfully tested in the US against the coronavirus and it partnered with aircraft maker Boeing to distribute its microbe shield.
The ASX 200 index was up 0.4 per cent as well to 6,816, with most sectors higher at 12:40pm AEDT.
Miners led the rises, followed by technology, healthcare and consumer staples.
Education, consumer discretionary firms and education companies were weaker.
Going up were construction supplies firm Boral (+5.3pc) on a share buyback plan, medical imaging firm Pro Medicus (+5.6pc) and data centre operator Megaport (4.3pc).
Going down were travel firm Webjet (-5pc), share registry firm Computershare (-2.8pc) and fruit and vegetable grower Costa Group (-2.3pc).
The Australian dollar was weaker at 75.81 US cents, down 0.2 per cent at 12:40pm AEDT.
Spot gold increased 0.1 per cent to $US1708.82 an ounce and Brent crude oil rose 0.4 per cent to $US62.99 a barrel.
Retail sales and home loans fall
The Australian Bureau of Statistics said retail trade fell 0.8 per cent on a seasonally adjusted basis from January.
However, turnover was up by just over 9 per cent from February last year.
Spending dropped on food but rose on household goods, especially electrical goods and furniture.
People spent more at cafes and restaurants, but less on takeaway food.
Spending fell in Western Australia, Victoria and the Northern Territory, but rose in New South Wales, Queensland, South Australia, ACT and Tasmania.
The ABS said home loans fell 0.4 per cent in February on a seasonally adjusted basis, the first fall since May 2020.
ABS head of finance and wealth, Katherine Keenan, said mortgage commitments remained near record high levels.
“The fall in February was driven by reduced loan commitments for existing dwellings, although the value of these loan commitments remained 39.7 per cent higher than in February 2020.”
The trade surplus narrowed from $9.6 billion in January to $7.5 billion in February, seasonally adjusted, as exports fell and imports rose.
Other ABS data showed that job vacancies rose nearly 14 per cent from the November to February quarters.
AMP boss to ‘retire’
Shares in investment firm AMP jumped 5.1 per cent to $1.33 after chief executive Francesco De Ferrari stepped down following a week of leadership speculation.
He will be replaced by deputy ANZ chief executive Alexis George in the third quarter of this year.
AMP says Mr De Ferrari will stay on during the interim period to ensure a smooth transition to Ms George.
Corporate regulator sues CBA
The Australian Securities and Investments Commission has launched legal action in the Federal Court against the Commonwealth Bank alleging that it incorrectly charged monthly access fees to customers and misled them.
ASIC has accused the bank of incorrectly charging monthly fees to customers, who were entitled to fee waivers, including pensioners and students.
It said almost $55 million in fees were incorrectly charged to nearly one million customers between June 2010 and September 2019.
Between April 2015 and September 2019, ASIC alleges CBA incorrectly charged monthly access fees on approximately 2.4 million occasions, totaling around $11.5 million.
The CBS said it had apologised to customers and would defend the case as it disagreed with the way the alleged errors had been formulated in the proceedings.
It said it had compensated customers to the tune of $64.2 million and provided multiple breach reports to ASIC.
The bank has finalised the sale of its CommInsure life insurance unit, which was embroiled in financial scandal.
AIA Australia bought the business for $2.4 billion.
Commonwealth Bank shares were down 0.1 per cent to $86.01 at 12:45pm AEDT.
APRA takes action against Macquarie
The Australian Prudential Regulation Authority has ordered Macquarie Bank to hold an extra $500 million in capital because of multiple material breaches of APRA’s prudential and reporting standards between 2018 and 2020.
It also raised Macquarie’s liquidity requirements by 15 per cent.
“The breaches are historical and do not impact on the current overall soundness of Macquarie Group’s capital or liquidity positions.”
Macquarie shares fell 0.7 per cent to $151.65.
S&P 500 at new record high
Technology stocks on Wall Street surged as investors awaited details of US President Joe Biden’s $2.6 infrastructure plan.
The S&P 500 index reached a record high, with the US benchmark index closing in on 4,000 for the first time as investors bet on a strong economic rebound.
“The trend we’re seeing today is investors rotating back into growth-oriented names that have gotten a little bit beaten up over the past few weeks or so due to underlying rotation toward the economic reopening stocks,” said Michael Sheldon, chief investment officer at RDM Financial Group.
Apple increased 1.9 per cent after a stockbroker upgrade, and Walgreens Boots Alliance rose after raising its 2021 profit forecast on higher sales at its US retail pharmacy stores.
The Dow Jones Industrial Average turned lower in late trade. It lost nearly 0.3 per cent to 32,982.
The S&P 500 index rose nearly 0.4 per cent to 3,973 while the Nasdaq rose 1.5 per cent to 13,247.
The three major indexes marked their fourth quarterly rise in a row.
Last week, the Dow hit a record closing high, thanks to the recent $US1.9 trillion fiscal stimulus and vaccine rollouts.
Investors once again sold off government bonds, with 10-year Treasury yields rising as high as 1.753 per cent, after initially being pushed down on demand from traders rebalancing their portfolios for the end of the March quarter.
Meanwhile, US private employers boosted hiring in March as more Americans got vaccinated against COVID-19.
The ADP National Employment Report was slightly below economists’ expectations, but the jump in hiring aligned with a recent improvement in employment market conditions.
Deliveroo shares plunge on IPO
In Europe, shares closed slightly lower.
Britain’s blue-chip FTSE 100 index fell 6,714 as online food delivery firm Deliveroo fell by one third on its first day of trading.
Deliveroo’s performance was dubbed “the worst IPO in London’s history” by one of its bankers.
The DAX in Germany was little changed at 15,008 and the CAC 40 in Paris fell 0.3 per cent to 6,067.
In commodities, Brent crude slid 0.9 per cent to $63.57 a barrel, while West Texas crude oil fell 2 per cent to $US59.31 a barrel.
Spot gold rose 1.3 per cent to $US1705.79 an ounce as the greenback eased off a five-month peak.