ASX Large Caps: Cyclicals gain as spiking bond yields stoke fears of rate hike

ASX finished the week on a positive note
Bond traders signal RBA rate hike this year
Rotation to cyclical sectors in equities

Local blue chips traded in positive territory all day and closed 0.26% higher. For the week, the benchmark ASX 200 index was up 1.60%, narrowing its loss for the year to just 2%.

There was a clear rotation to cyclical sectors today as Aussie bond traders ditched 3-year govies, positioning themselves for a RBA rate hike this year.

The 3-year Aussie government bond yields spiked to a three-year high, which implied a cash rate of over 1.60% by December (vs the current 0.1%).

This means bond traders are expecting five or six 25bp RBA hikes throughout the year until December.

ASX cyclical stocks like Mining and Utilities led the way, while Tech stocks were sold off as investors retreated from rate sensitive sectors.

Meanwhile, energy traders are nervously watching Biden’s current visit to Europe, which could result in new sanctions on Russia’s energy.

Brent crude is seesawing around the US$120 a barrel level, but recent reports have indicated that an US/EU announcement on Russian embargo could be released as early as today (EU time).

The prospect of higher commodity prices and rise in interest rates has lifted the Aussie dollar to US 75.20, at the time of writing.

BIG CAP WINNERS

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Code	Name	Price	% Change	Volume	Market Cap
BAP	Bapcor Limited	7.17	10.3%	8,831,834	$2,206,181,250
SQ2	Block	157.32	9.2%	242,402	$13,737,286,715
MP1	Megaport Limited	14.66	7.7%	1,830,642	$2,147,491,727
CTT	Cettire	2.89	7.0%	1,550,106	$1,029,343,194
PDN	Paladin Energy Ltd	0.79	6.8%	25,455,015	$1,982,416,330
AMP	AMP Limited	1.06	5.0%	116,460,508	$3,298,766,912
CXO	Core Lithium	0.86	4.9%	31,092,814	$1,389,349,984
NAN	Nanosonics Limited	4.73	4.9%	2,134,816	$1,361,022,402
INR	Ioneer Ltd	0.645	4.9%	12,108,314	$1,261,087,265
HMC	Homeco Limited	6.59	4.6%	381,095	$1,828,678,037
AKE	Allkem Limited	9.91	4.4%	3,519,000	$6,050,117,811
LTR	Liontown Resources	1.575	4.3%	14,752,068	$3,310,260,049
NAB	National Aust. Bank	29.61	4.3%	8,564,259	$92,031,747,084
29M	29Metalslimited	2.71	4.2%	2,343,440	$1,249,183,000
VEA	Viva Energy Group	2.49	4.2%	5,111,839	$3,708,062,204
FMG	Fortescue Metals Grp	22.31	4.1%	6,708,839	$65,982,218,193
SFR	Sandfire Resources	7.44	4.1%	2,643,462	$2,931,370,535
IMD	Imdex Limited	2.86	4.0%	1,768,970	$1,090,244,100
APM	APM Human Services	2.89	4.0%	2,269,439	$2,549,765,810
APX	Appen Limited	9	3.9%	1,370,039	$1,065,828,773
SWM	Seven West Media Ltd	0.795	3.9%	10,892,566	$1,216,440,453

Sayona Mining (ASX:SYA) was once again up 15% on specific news.. The SYA share price has surged 80% in the past month after revealing a doubling of its Québec lithium resource base at the beginning of March.

Firefinch (ASX:FFX) said its Viper Mineral Resource Estimate (MRE) increased by 128% to 3.27 million tonnes, while the N’Tiola MRE increased by 18% to 2.90 million tonnes.

BIG CAP LOSERS

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Code	Name	Price	% Change	Volume	Market Cap
CIM	Cimic Group Ltd	15.94	-6.8%	1,318,722	$5,326,279,453
DEG	De Grey Mining	1.165	-6.4%	9,683,120	$1,750,997,289
TPW	Temple & Webster Ltd	8.35	-5.4%	1,296,915	$1,063,599,354
ASX	ASX Limited	83.41	-3.8%	908,648	$16,786,636,497
PXA	Pexagroup	17.82	-3.7%	295,483	$3,280,527,078
ABC	Adbri Limited	2.91	-3.6%	1,751,467	$1,970,935,216
NCK	Nick Scali Limited	13.5	-3.6%	536,258	$1,134,000,000
HSN	Hansen Technologies	5.01	-3.3%	298,178	$1,039,479,587
AGL	AGL Energy Limited.	7.29	-3.2%	8,716,030	$4,957,595,030
FCL	Fineos Corp Hold PLC	3.68	-3.2%	35,741	$1,211,944,496
MGR	Mirvac Group	2.54	-2.7%	16,300,596	$10,290,364,166
ALX	Atlas Arteria	6.91	-2.7%	2,207,029	$6,809,029,405