• ASX rallied strongly on Thursday after US Fed signalled multiple rate cuts in 2024
  • All sectors were up, lithium stocks led
  • Viva Energy given green light by ACCC to acquire OTR Group

 

The ASX surged strongly by more than 1.5% on Thursday, driven by Wall Street’s rally last night as the US Fed signalled multiple rate cuts in 2024.

US shares jumped and bond yields fell sharply after the Fed signalled a total of 75 basis points of rate cuts in 2024 from three separate cuts. This was after the central bank decided to leave interest rates unchanged again this month.

The market also reacted to the ABS report today, which showed the unemployment rate in Australia rose 0.1% to 3.9% in November.

“This is the final Christmas present for the RBA after being handed down better-than-expected inflation data and softer-than-expected retail sales in recent weeks,” said Josh Gilbert, a market analyst at eToro.

But Gilbert warned investors not to be too hopeful.

“Although we may have seen the final hike from the RBA with data moving in the right direction, it may still be one of the last major central banks to cut rates in 2024,” he said.

On the ASX, all 11 sectors were in the green today, led by the rates sensitive Real Estate and Tech.

Lithium stocks were also top of the winners list, with the likes of IGO (ASX:IGO) and Allkem (ASX:AKE) climbing by 10%. This comes following pledges from the just concluded COP28 meeting in Dubai to “transition away” from fossil fuels.

Insurance stocks like QBE (ASX:QBE) and IAG (ASX:IAG) meanwhile were the main laggards today, down by 4% each.

Across the region, major Asian stock markets rallied. Japan’s Nikkei 225 was the outlier, falling by half a percentage point in part due to a strong yen.

 

BIG CAP WINNERS

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Viva Energy (ASX:VEA) jumped after the Australian Competition & Consumer Commission (ACCC) said it will not oppose VEA’s proposed acquisition of OTR Group, given VEA will offload 25 Coles Express outlets in South Australia.

The ACCC has now approved Chevron Australia Downstream as an acceptable purchaser of those sites. In exchange for the 25 divestiture sites, Viva Energy will receive 13 Chevron sites located in Queensland, New South Wales and Western Australia.

Viva Energy expects to complete the acquisition of OTR Group in the first half of 2024, subject to Foreign Investment Review Board (FIRB) approval.

National Australia Bank (ASX:NAB) and Jarden Wealth have agreed to combine their New Zealand wealth advice and asset management businesses into a newly formed entity in which NAB, Jarden Wealth and Pacific Equity Partners (PEP) will be the shareholders.

Under the proposed transaction, NAB and Jarden Wealth will each receive a cash payment along with a retained shareholding of 45% and 20% respectively. PEP will acquire a 35% stake, with its investment used to fund the payments to NAB and Jarden. The new entity will be called FirstCape.

IGO (ASX:IGO) said assays from hole CPW0002DD at the Copper Wolf Project have returned 405.38 metres at 0.70% CuEq1 from 608.38 metres, including 105.77 metres at 0.86% CuEq from 700.43 metres.

Genesis Minerals (ASX:GMD) will purchase from Kin Mining (ASX:KIN) tenements hosting 610,000 JORC compliant ounces that comprise part of Kin’s 100%-owned Cardinia Gold Project in WA for $53.5 million in cash and Genesis shares.

 

BIG CAP LOSERS

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NZ financial outfit Heartland Group (ASX:HGH) has provided an update on its FY24 year to date.

YTD receivables growth was 4.7%, with Australian and New Zealand reverse mortgages notably achieving YTD growth of 20.4% and 17.8%, respectively.

Despite this, Heartland said it has experienced a slower than expected start to FY24, mainly due to a decrease in the purchase of new cars.

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