The S&P/ASX 200 (XJO) closed the day up by 170.8 points at 8,804.0, achieving a remarkable 2.0% increase from its low during the session, and perfectly matching its high. The broader S&P/ASX 300 (XKO) showed a strong advance, with gainers outpacing decliners 220 to 65, indicating an exceptionally vibrant session.
Over the week, the XJO rose 171 points or 2.0%, concluding at its weekly peak—a notable achievement for the market.
Notably, the Gold Sub-Index (XGD) experienced a significant turnaround, climbing 5.7% after having dropped 14% in the previous five sessions. This resurgence was fueled by a 2.1% increase in COMEX gold futures, which reached US$4,200/oz, and a 4.1% rise in COMEX silver futures, now valued at US$66.62/oz. Precious metals are highly responsive to fluctuations in benchmark bond yields and the US dollar, both of which fell sharply amid optimism regarding a peace deal that eased inflation concerns. The US 10-year Treasury yield dropped by 10 basis points, while the US Dollar Index fell to 94.5, down from nearly 100 earlier in the week.
Following weeks of harsh selling, investors swiftly capitalised on perceived bargains. The surge in mineral stocks included Genesis Minerals (GMD) (+10.8%), Black Cat Syndicate (BC8) (+9.8%), Pantoro Gold (PNR) (+9.6%), Evolution Mining (EVN) (+7.3%), Northern Star Resources (NST) (+5.1%), and Newmont (NEM) (+4.0%).
The Materials sector (XMJ) showcased its largest one-day gain in 14 months, rising by 4.1%. This surge can be attributed to declining benchmark yields, which benefit global economic growth by lowering capital costs. A weaker US dollar further contributed to this rise, making commodities, typically priced in USD, more affordable for international buyers.
In the commodity landscape, COMEX copper futures rose by 1.9% to US$6.392/lb, prompting gains in Sandfire Resources (SFR) (+8.1%), BHP (BHP) (+3.5%), South32 (S32) (+3.4%), and Rio Tinto (RIO) (+2.4%). Additionally, Fortescue (FMG) (+3.1%) and building materials firm James Hardie Industries (JHX) (+6.1%) also experienced positive movement.
Lithium stocks continued their commodity-driven recoveries for the third consecutive session, with GFEX lithium carbonate futures climbing 3.0% to CNY 176,560/t. This increase was part of a broader upward trend, with lithium futures gaining 12.3% over the past six sessions. Companies such as Elevra Lithium (ELV) (+12.5%), Develop Global (DVP) (+10.4%), Liontown Resources (LTR) (+9.8%), and Pilbara Minerals (PLS) (+9.8%) saw significant increases.
The uranium sector also saw its first gain in four sessions, with stocks like Deep Yellow (DYL) (+4.0%) and Paladin Energy (PDN) (+3.6%) rebounding.
Consumer discretionary stocks (XDJ) also benefited, climbing 2.0% as falling bond yields fed into expectations of enhanced household spending. Key players including Lovisa (LOV) (+3.6%), Temple & Webster (TPW) (+3.5%), and Wesfarmers (WES) (+2.6%) performed well.
With a retreat in bond yields, the Real Estate (XPJ) (+1.8%) and Utilities (XUJ) (+1.1%) sectors followed suit due to the attractiveness of their income streams. Leading the Real Estate sector were Lendlease (LLC) (+4.7%) and Goodman Group (GMG) (+2.2%).
In the Financials sector (XFJ), which rose 1.6%, there was a recovery from last week’s selling pressure, spurred by the easing of bond yields. All four major banks gained, led by National Australia Bank (NAB) (+2.3%) and Commonwealth Bank (CBA) (+2.0%).
Despite this positive environment, the Information Technology (XIJ) sector only managed a marginal increase of 0.5%. Companies such as Siteminder (SDR) (+7.8%) and Elsight (ELS) (+5.4%) provided the most substantial contributions.
Consumer Staples (XSJ) gained 0.8% as capital flowed back from defensive stocks, with Endeavour Group (EDV) (+1.9%) and Woolworths (WOW) (+0.6%) seeing modest increases.
Conversely, the Energy sector (XEJ) declined by 0.5%, mainly due to falling oil prices—a situation driven by expectations of a reopening at Hormuz. ICE Brent crude futures fell 2.3% to US$88.24/bbl, impacting stocks like Viva Energy (VEA) (-3.4%).
Finally, Communication Services (XTJ) also struggled, finishing 0.3% lower, with News Corp. (NWS) declining by 4.3%.
Overall, the session marked an encouraging turnaround for many sectors following a tumultuous period, signalling potential recovery as market dynamics shift.
