ASX January winners: ASX reached record high but February off to a rocky start

• The S&P/ASX 200 rose 5% in January to reach a new record high
• Utilities was the only sector to fall in January with financials the top performer
• AusQuest tops January winners up 388% with discovery of a large-scale Peruvian copper prospect

While US President Donald Trump’s tariffs policy have hit the ASX hard at the start of February, global equities had a strong start to the new year, with Australia’s S&P/ASX 200 rising by 5% to reach a new record high in January, according to S&P Dow Jones Indices (S&P DJI).

VanEck head of investments and capital markets Russel Chesler told Stockhead January was a positive month for Australian equities, driven by the financial sector, which was buoyed by US bank highlighting stronger-than-expected earnings reports and increased M&A activity.

He said international equities also performed well, albeit with a softer return of 2.74% with the fallout from China’s artificial intelligence play DeepSeek significantly impacting US megatech, with Nvidia notably plummeting 17% in a single day.

“Conversely, the telecommunications sector emerged as the best performer, benefiting from the potential acceleration in AI activity,” he said.

Bitcoin surged to a new all-time high, surpassing US$109,000 on the day of Trump’s inauguration.

“This spike was driven by optimism in the crypto market as Trump’s administration was perceived as highly pro-crypto.

“He signed the first-ever cryptocurrency executive order, which included the creation of a Crypto Task Force, regulatory clarity, and the prohibition of central bank digital currencies.

Bitcoin has since retreated to below the US$100k mark following the Trump administration’s recent trade tariff announcements. At the time of writing, BTC is holding steady just above US$95k. The broader crypto market, however, has been comparatively pulverised on a blood-spattered Monday for digital assets.

“Today’s market movements, following President Trump’s implementation of tariffs on imports from Mexico, Canada, and China, along with Canada’s retaliatory measures, suggest that we may experience more frequent bouts of market volatility under the Trump administration,” Chesler said.

“Additionally, the inflationary impact of these tariffs could limit the pace of forecasted rate cuts.

“Trump has also threatened to impose tariffs on European imports, although a specific timeline has yet to be established and until we gain more certainty, investment markets may face a turbulent period.”

Financials among the gainers, utilities drop

Ten out of 11 sectors in the S&P/ASX 200 reported gains, with consumer discretionary leading the gainers up 7% followed by financials, rising 6%.

Utilities was the only sector that remained in the red, falling 2.4% in January.

Momentum tops equity factors again, bonds positive

Australian bonds ended the month on a positive note, with short-dated government bond yields edging lower and credit spreads tightening.

“Positive sentiment was influenced by a weaker-than-expected Q4 inflation print, which bolstered market expectations for a rate cut in February,” Chesler said.

S&P DJI said among factor indices, S&P momentum once again led the pack with a 7% gain, while enhanced value and low volatility lagged.

Equity volatility declined modestly in January, as indicated by the VIX and S&P/ASX 200 VIX – known as the fear index.

However, S&P DJI noted the options market was anticipating a wide stock dispersion, with the CBOE S&P 500 Dispersion Index briefly soaring over 37, its highest level since its launch in September 2023.

The 50 best performing ASX stocks in January

AusQuest (ASX:AQD)  was the top performer in January, up 388%  after finding a potentially large-scale Peruvian copper prospect.

Maiden drilling uncovered broad zones of visible copper mineralisation – oxides and sulphides – in seven of the eight holes for 3000m.

The best hit of two for which assays have been returned included 348m at 0.26% Cu and 0.06ppm gold. Assay results from the remaining six drill holes are expected by early February.

Agribusiness firm Wellard (ASX:WLD) rose 142% in January after inking a deal to sell its last livestock vessel, the M/V Ocean Drover, for US$50 million. The buyer is Meteors Shipping, a Turkish agribusiness Wellard has worked with before. After the sale, Wellard said it plans to wind down its ship operations.

RemSense Technologies (ASX:REM) rose 126% in January after announcing a solid Q2 FY25, including positive cash flow with $431K in the bank.

Customer receipts shot up 78% from the previous quarter to $1.18m, plus another $1.08m came in after the quarter ended. RemSense said it nailed multiple global contracts in the quarter, all on time and budget, including a subscription renewal from Newmont for its Virtualplant platform.

Medical Developments International (ASX:MVP) rose 64% after also reporting a solid quarter, with operating cashflow improving.  The company said its lead drug Penthrox continued to grow in the Australian hospital sector. Revenue for Q2 FY25 was $10.9m, up $1.8m from the previous quarter, and $4.9m higher for the first half of FY25.

The 50 worst performing ASX stocks in January