The benchmark S&P/ASX200 index was up 35 points, or 0.48 percent, to 7,313.3 at noon AEST on Monday. To 7,518.9, the All Ordinaries increased by 29 points, or 0.39 percent.
The advances followed a report on non-farm payrolls that showed the US employment market was cooling late on Friday as a result of the Federal Reserve’s campaign of significant interest rate hikes, but that there was still some underlying momentum.
“Fed chair (Jerome) Powell, or President Biden for that matter, probably couldn’t have scripted a better August employment report if they’d tried,” writes Ray Attrill, head of FX strategy and markets for NAB.
“The Goldilocks metaphor is frequently misused in the economic and financial communities, but in light of the various’soft landing’ signals coming from the report, it does seem entirely appropriate on this occasion.”
Following the reading, the CME FedWatch Tool reported that market expectations that the Fed would raise interest rates at its upcoming meeting on September 20 decreased to just a 7% likelihood from a 20% chance a week earlier.
Following last week’s softer-than-expected inflation readout, markets and economists are optimistic the Reserve Bank will maintain rates at the central bank’s board meeting on Tuesday.
Simply put, the “data dependence” requirement makes it too difficult for the RBA to defend any increase in policy rates at Tuesday’s meeting, according to GSFM investment strategist Stephen Miller.
The greatest gainer among the ASX200 at midday was Liontown Resources, which increased 9.2% to $2.86 after the board of the lithium developer said it was eager to accept a $3 per share, $6.6 billion provisional buyout offer from the largest lithium producer in the world.
Liontown is letting US-based Albemarle look over its financial records in an effort to finalise a formal acquisition agreement.
On the other hand, Leo Lithium fell 52.2% to 54.5c when it began trading for the first time since July 18 after the Mali government ordered it to halt exporting crushed lithium ore from the country’s Goulamina mine.
Leo claims that while it would have hoped to sell the ore before its processing unit opened the following year, the project could still be completed without it.
BHP and Rio Tinto were both up 2.6% in other mining-related news, while Fortescue Metals had down another 0.9%.
The performance of the Big Four banks was varied, with CBA rising 0.4% and NAB rising 0.3%, while ANZ had fallen 0.2% and Westpac had remained unchanged.
Following a complaint from a former client who claims SkyCity didn’t recognise or address his problem gambling, New Zealand’s Department of Internal Affairs petitioned the Gambling Commission to suspend SkyCity Entertainment’s casino licence for 10 days. As a result, SkyCity Entertainment’s stock fell 15.9% to $1.825.