ASX Trading Wrap: Tech stocks rebound, gold and lithium miners return to favour

ASX Trading Wrap: Tech stocks rebound, gold and lithium miners return to favour

The ASX 200 set a near 14 month high and passed the 7,000 mark for the first time since late February last year, as the local stock market continued its ascent this week, rising 2.4%. 

Strength came from the tech sector, where a positive lead from the Nasdaq was spurred on by steadying bond yields and encouraging remarks from the US Federal Reserve around the economic recovery. At the close of trade today, the benchmark index finished on 6,995.2 points.

 

Which shares excelled?

As tech stocks staged a rebound, Afterpay (ASX: APT) was one of the primary beneficiaries, leaping 15.1%. The buy-now pay-later giant also wrapped up its tender offer associated with an equity incentive plan from 2018, thereby increasing its underlying interest in its US subsidiary to 91%.

The risk-on appetite for tech also extended to other heavyweight names like Xero (ASX: XRO) and NextDC (ASX: NXT), each posting strong performances. But the resurgence wasn’t limited to traditional tech either, with portal websites like Domain Holdings Australia (ASX: DHG), Carsales (ASX: CAR), REA Group (ASX: REA) and Seek (ASX: SEK) all rising sharply, not to mention ecommerce retailers Kogan (ASX: KGN) and Temple & Webster (ASX: TPW).

Meanwhile, other payments stocks that joined the rally included EML Payments (ASX: EML), Zip Co (ASX: Z1P), Sezzle (ASX: SZL) and Tyro Payments (ASX: TYR). In the case of EML Payments, the company announced that it has entered into a binding Share Purchase Agreement to acquire 100% of Sentenial Limited, including its open banking product. Shareholders were delighted by the company’s move to broaden its strategy to non-card and non-scheme payment products, with EML shares up 17.1%.

Gold miners and explorers have had a promising start to the new quarter, with names like Silver Lake Resources (ASX: SLR), De Grey Mining (ASX: DEG), OceanaGold Corporation (ASX: OGC), Ramelius Resources (ASX: RMS) and Northern Star Resources (ASX: NST) all delivering handsome returns. It comes as the price of the precious metal has found a steady footing after a poor first quarter.

There was also a lift in lithium stocks, which followed a blowout quarterly EV delivery report from Tesla. With many companies now vying to boost their EV production capabilities, a number of ASX-listed stocks leveraged to battery metals have been favoured. This week it was Orocobre (ASX: ORE), Galaxy Resources (ASX: GXY) and Pilbara Minerals (ASX: PLS).

Some other names on the front foot this week were Champion Iron (ASX: CIA), Reece (ASX: REH) and Pointsbet Holdings (ASX: PBH).

 

 

Which shares dragged on the market?

In a week where the market was buoyed by strong momentum across a number of different sectors, there were fewer names than usual on the list of poor-performing stocks.

Chorus (ASX: CNU) slumped 6.4% as the New Zealand-based telecommunications group reduced its indicative Maximum Allowable Revenue (MAR) range from $715-755 million to $680-710 million. Following the announcement, the stock is now circling its yearly low.

Incitec Pivot (ASX: IPL) was also sold down this week on news from the company regarding an update on operations at its Waggaman ammonia plant. As part of the update, it was revealed that the recommencement of operations had been postponed after the plant was brought down following a dry gas seal failure. Repairs are currently ongoing, with operations expected to start mid-April. Shares in IPL slipped 3.8%.

Australia’s sudden change in vaccine strategy also had an impact on the travel sector, although gains earlier in the week shielded several of these stocks from incurring weekly losses. Nonetheless, the vaccine news means that optimism of international travel plans for later this year is once again in limbo. Corporate Travel Management (ASX: CTD) took a hit, down 3.7%.

Finally, NZ-based energy stocks Genesis Energy (ASX: GNE), Z Energy (ASX: ZEL) and Meridian Energy (ASX: MEZ) all saw modest losses for the week as funds flowed elsewhere.

 

We’ll be back next week with another Weekly ASX Trading Wrap Up – until then, have a great week!

 

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