The Australian share market rebounded on Tuesday, posting its biggest one-day gain in more than two years. The ASX 200 Index finished up 2.3 percent, or 166.7 points, to 7510 points, marking its strongest gain since November 2022. This rally helped recoup some of Monday’s 4.2 percent slump triggered by China’s retaliatory tariffs on the US.
US futures pointed to some relief on Tuesday after volatility gripped Wall Street overnight. The benchmark S&P 500 traded in a more than 410-point range. Asset prices swung as US President Donald Trump threatened additional 50 percent tariffs on Chinese imports. Beijing responded to Trump’s threat, saying it would “resolutely take countermeasures.”
Andrew Dale, a partner at ECP Asset Management, cautioned that Australian equities were unlikely to head into a sustained rally despite the market’s substantial correction. “We see a little bit of a relief rally, but there’s nothing that I’m seeing in the macro data or economically that would enable one to take the view that [the sell-off] is now all over, and we’re off to the races. Absolutely not,” he said.
On the ASX, all 11 sectors finished higher as energy, mining, and technology rebounded from heavy losses in the previous session.
Sharemarket posts most considerable gain recovery
ASX technology stocks rallied, buoyed by WiseTech’s 5 percent jump to $80.35.
Payments provider Zip Co added 6.7 percent, closing at $1.27, after it announced an on-market buyback of up to $50 million. Energy stocks also recovered, with Santos adding 5.4 percent to close at $5.66. Miners bucked a weaker iron ore price, with Singapore’s benchmark futures contract dropping 2.4 percent to $US95.20.
BHP gained 2.3 percent to $35.38, and Rio Tinto rose 3.5 percent to $14.82. Banks saw a late rally, led by Commonwealth Bank, which closed up 2.8 percent at $148.46. The Australian dollar also edged back above US60ยข after nearing a five-year low overnight.
In corporate news, Mexican-style food chain Guzman y Gomez advanced 3.7 percent to $31.10 and reported it is on track to pay its first-ever dividend after posting strong sales growth in the third quarter. Pro Medicus jumped 6.4 percent to $188.14 after Barrenjoey upgraded the imaging software play to “overweight.” The current market dynamics are influenced by international trade tensions and investor sentiment reacting to geopolitical developments.
Analysts and market experts are issuing warnings but caution against quick, knee-jerk reactions as uncertainty and fear grip financial markets.
Image Credits: Photo by Clay Banks on Unsplash
