The S&P/ASX 200 closed 27.7 points higher, up 0.34%.
A far more solid showing from Aussie shares today, the breadth was 2 to 1 positive and we closed above the 8282 point of supply I identified in last evening’s XJO ChartWatch.
2024's winning sectors like Technology, Consumer Discretionary, Healthcare and Financials continued to do well, while last year's losing sectors like Resources continued to struggle.
Click/scroll through for the usual reporting of the major sector and stock-specific moves, the broker responses to them, as well as all the key upcoming economic data in tonight's Evening Wrap.
Also, I have detailed technical analysis on Chinese A-Shares and Property Sector, plus the S&P/ASX 200 Resources Sector Index (XJR) in today's ChartWatch.
Let's dive in!
Tue 07 Jan 25, 5:01pm (AEDT)
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The S&P/ASX 200 (XJO) finished 27.7 points higher at 8,285.1, 0.34% from its session low and just 0.15% from its high. In the broader-based S&P/ASX 300 (XKO), advancers beat decliners by a resounding 180 to 91 (it was roughly 200 vs 80 with an hour to go…though).
A far more solid showing from Aussie shares today, the breadth was 2 to 1 positive and we closed above the 8282 point of supply I identified in last evening’s XJO ChartWatch.
Sector-wise, participation came most from the usual suspects from 2024, particularly high-PE sectors like Information Technology (XIJ) (+1.6%), Communication Services (XTJ) (+1.4%), Consumer Discretionary (XDJ) (+0.86%), and Health Care (XHJ) (+0.84%).
Flat-to-slightly down risk-free market yields helped investor confidence across these, and the strategic shift towards sectors favoured by the steepening yield curve also prospered – like Financials (XFJ) (+0.37%).
On the topic of "strategic shifts", I can’t help but feel there’s a bit of “start of the calendar year fund flow” stuff going on this week. Basically, funds are betting that 2024's winners will continue to be 2025's winners…And that 2024's losers, like Resources (XJR) (-0.86%), well you get the drift…
I have more analysis aimed at shedding light on the losers part of the equation in this evening’s ChartWatch, below.
Company | Last Price | Change $ | Change % | 1mo % | 1yr % |
Opthea (OPT) | $0.795 | +$0.055 | +7.4% | +11.2% | +54.1% |
Silex Systems (SLX) | $6.17 | +$0.4 | +6.9% | -1.8% | +50.9% |
Nine Entertainment (NEC) | $1.325 | +$0.07 | +5.6% | +6.0% | -33.2% |
Appen (APX) | $3.10 | +$0.16 | +5.4% | +32.5% | +416.7% |
Nuix (NXL) | $6.59 | +$0.34 | +5.4% | -1.6% | +249.6% |
Temple & Webster Group (TPW) | $14.19 | +$0.69 | +5.1% | +12.8% | +63.1% |
Clarity Pharmaceuticals (CU6) | $4.15 | +$0.18 | +4.5% | -28.3% | +119.1% |
Iperionx (IPX) | $5.56 | +$0.23 | +4.3% | +21.9% | +308.8% |
Firefly Metals (FFM) | $0.890 | +$0.035 | +4.1% | -16.4% | +42.4% |
IDP Education (IEL) | $12.74 | +$0.48 | +3.9% | +0.1% | -36.3% |
Superloop (SLC) | $2.17 | +$0.08 | +3.8% | -4.0% | +223.9% |
Bapcor (BAP) | $4.69 | +$0.17 | +3.8% | +4.2% | -12.8% |
Hub24 (HUB) | $72.65 | +$2.6 | +3.7% | -4.7% | +104.8% |
Siteminder (SDR) | $5.96 | +$0.21 | +3.7% | -5.4% | +14.6% |
Audinate Group (AD8) | $7.43 | +$0.26 | +3.6% | -8.3% | -54.8% |
Qantas Airways (QAN) | $9.29 | +$0.32 | +3.6% | +4.6% | +75.9% |
Judo Capital (JDO) | $1.890 | +$0.065 | +3.6% | -4.3% | +92.9% |
Domain Australia (DHG) | $2.68 | +$0.09 | +3.5% | -3.6% | -19.5% |
Droneshield (DRO) | $0.760 | +$0.025 | +3.4% | +8.6% | +105.4% |
Car Group (CAR) | $38.36 | +$1.26 | +3.4% | -6.6% | +25.0% |
Netwealth Group (NWL) | $29.88 | +$0.98 | +3.4% | -2.9% | +94.5% |
Magellan Financial Group (MFG) | $10.91 | +$0.33 | +3.1% | -4.5% | +16.3% |
Life360 (360) | $23.51 | +$0.71 | +3.1% | -11.6% | +225.6% |
Metals Acquisition (MAC) | $17.30 | +$0.52 | +3.1% | -13.2% | 0% |
WA1 Resources (WA1) | $14.37 | +$0.42 | +3.0% | -4.8% | +12.4% |
Company | Last Price | Change $ | Change % | 1mo % | 1yr % |
Champion Iron (CIA) | $5.42 | -$0.38 | -6.6% | -9.2% | -37.6% |
Brainchip (BRN) | $0.355 | -$0.02 | -5.3% | +51.1% | +97.2% |
Fortescue (FMG) | $17.25 | -$0.8 | -4.4% | -12.4% | -40.4% |
Perenti (PRN) | $1.385 | -$0.055 | -3.8% | +8.6% | +37.1% |
Bannerman Energy (BMN) | $3.38 | -$0.13 | -3.7% | +23.4% | +16.6% |
Dalrymple Bay Infrastructure/Notes (DBI) | $3.43 | -$0.13 | -3.7% | -2.6% | +26.6% |
Stanmore Resources (SMR) | $2.94 | -$0.1 | -3.3% | -10.6% | -26.9% |
Ramelius Resources (RMS) | $2.12 | -$0.06 | -2.8% | +0.5% | +28.5% |
Yancoal Australia (YAL) | $6.02 | -$0.17 | -2.7% | -3.5% | +13.4% |
G8 Education (GEM) | $1.270 | -$0.035 | -2.7% | -6.3% | +11.4% |
Coronado Global Resources (CRN) | $0.735 | -$0.02 | -2.6% | -14.5% | -57.1% |
New Hope Corporation (NHC) | $4.88 | -$0.13 | -2.6% | +2.7% | -8.1% |
Resolute Mining (RSG) | $0.390 | -$0.01 | -2.5% | -7.1% | -9.3% |
Cettire (CTT) | $1.445 | -$0.035 | -2.4% | +12.5% | -47.5% |
Whitehaven Coal (WHC) | $6.06 | -$0.14 | -2.3% | -6.9% | -22.4% |
Washington H Soul Pattinson & Company (SOL) | $33.62 | -$0.76 | -2.2% | -3.1% | +3.0% |
Lotus Resources (LOT) | $0.230 | -$0.005 | -2.1% | +2.2% | -28.1% |
Insurance Australia Group (IAG) | $8.38 | -$0.18 | -2.1% | -2.2% | +48.8% |
Kogan.Com (KGN) | $5.99 | -$0.12 | -2.0% | +18.1% | +22.7% |
Nickel Industries (NIC) | $0.795 | -$0.015 | -1.9% | -11.7% | +16.1% |
Just a quick picture equals a thousand words here on why Resources stocks have turned so sour over the break. Exhibit 1: China A-Shares. These are the shares you have to be a Chinese corporate or citizen to buy (the Shanghai Composite which contains shares anyone can buy looks far worse than this – but I'll leave the viewing of that chart to your homework!).
The market is simply responding out of frustration that Chinese economic data generally continues to point to a worsening situation on the ground, yet no bazooka of stimulus measures have been announced – despite repeated reassurances from Beijing spokespeople thoughout the back end of 2024 that it's on the way.
In Beijing's defence, history suggests they rarely do anything without careful measure, and even more rarely when Western investors want them to! So, perhaps it's market expectations and not a lack of definitive action from Beijing that's to blame here...🤔
Yikes! A thousand words and all...😱
Note the stimulus rally started in September. I'll be the first to admit, based on the price action around early November, I thought this one had some legs. That's the good thing about charts...regardless of what one thinks, the reality is there, plain to see!
I am watching for short and long term trend ribbons to begin to now act as areas of dynamic supply. If they do, we could be at the beginning of a prolonged downtrend here. Watch the price action at the ribbons, supply-side candles and falling peaks and falling troughs are a strong side the supply-side does not want to relinquish control.
The last time we covered the XJR was in ChartWatch in the Evening Wrap on 16 December.
In that update, it was rolling over once again in line with well-established short and long term downtrends. After a modest rally in the back-half of December on scant volume, which terminated at the dynamic supply of the short term trend ribbon, the XJR has started 2025 much like it spent most of 2024 – logging black candles.
For those who get a little cranky each time I state the obvious about a sector which they have a love affair with – I apologise for any annoyance this ChartWatch brings – but I just read the charts, I don’t make them.
If you want to blame someone for the above chart, blame the supply-side who is so clearly in control here…dealing out shares of resources companies with consistent determination, not fussing too much about price (hence the decline) because they understand the fundamentals for the sector dictate exactly this course of action.
While you’re at it, perhaps also blame the demand-side – after all they’re just as responsible for the XJR’s demise. Instead of standing pat and soaking up the aforementioned supply, they’re withdrawing their buy orders from the system, or only posting them at lower, and lower prices. They’re trying to figure out just how low share prices in the sector must be marked down to justify the inherent risk – again – dictated by the prevailing fundamentals.
The trends are firmly set to the downside here. But my brand of technical analysis, by definition, respects this means absolutely nothing about where the XJR will be tomorrow, next week, or at the end of 2025.
Simply, the status quo is one of supply-side control (today's downward pointing shadow notwithstanding!). I simply respect the fact that the market probably knows more about what’s going on in the sector than I do.
So why would I get in their way? 🤷
Today
AUS Building Approvals November m/m
-3.6% vs -0.9% forecast and +4.2% in October
Private sector houses fell 1.7%
Units and townhouses fell 10.8%
Tuesday
21:00 EUR Core Consumer Price Index (CPI) Flash Estimate December y/y (+2.7% p.a. vs +2.7% p.a. in November)
Wednesday
02:00 USA ISM Services PMI December (53.2 forecast vs 52.1 in November)
02:00 USA JOLTS Job Openings December (7.77 million forecast vs 7.74 million in November)
11:30 AUS CPI December y/y (2.2% p.a. forecast vs 2.1% in November)
Thursday
06:00 USA Federal Reserve FOMC meeting December minutes
11:30 AUS Retail Sales November m/m (+1.0% forecast vs +0.6% in October)
12:30 CHN CPI December y/y (+0.1% forecast vs +0.2% in November)
12:30 CHN Producer Price Index (PPI) December y/y (-2.5% forecast vs -2.5% in November)
Saturday
00:30 USA Non-Farm Employment Change December (+154,000 forecast vs +227,000 in November)
00:30 USA Unemployment Rate (4.2% forecast vs 4.2% in November)
00:30 USA Average Hourly Earnings December m/m (+0.3% forecast vs +0.4% in November)
+14.7% 4DMEDICAL (4DX) - 4DMedical receives U.S. FDA clearance for IQ-UIP
+11.3% Paradigm Biopharmaceuticals. (PAR) - No news, interesting chart here, rise is consistent with prevailing short-term uptrend, long-term trend is transitioning from down to up = watch out for it in tomorrow's edition of ChartWatch ASX Scans Uptrends! 🔎📈
+7.4% Opthea (OPT) - Opthea Announces Publication in Diabetic Macular Edema, rise is consistent with prevailing short and long-term uptrends, another interesting chart…ditto watch tomorrow's ChartWatch ASX Scans Uptrends! 🔎📈
+6.9% Silex Systems (SLX) - No news, uranium rally continues after last week's announcement news that Cameco’s (TSX: CCO; NYSE: CCJ) Inkai joint venture project in Kazakhstan has suspended uranium production, plus associated uranium price rally
+6.7% Novonix (NVX) - Location Announced for New Plant in Chattanooga, TN
+5.6% Nine Entertainment (NEC) - No news…dogs of 2024 turnaround? 🤔
+5.4% Appen (APX) - No news, continued rally in US dollar-exposed technology stocks, rise is consistent with prevailing short and long-term uptrends, a regular in ChartWatch ASX Scans Uptrends list 🔎📈
+5.4% Nuix (NXL) - No news, ditto strong US-dollar exposed tech stocks, rise is consistent with prevailing long-term uptrend 🔎📈
+5.1% Temple & Webster Group (TPW) - No news, generally stronger ASX Consumer Discretionary sector today, rise is consistent with prevailing short and long-term uptrends, a regular in ChartWatch ASX Scans Uptrends list 🔎📈
+4.3% Iperionx (IPX) - No news, rise is consistent with prevailing short and long-term uptrends, a regular in ChartWatch ASX Scans Uptrends list 🔎📈
+3.9% IDP Education (IEL) - No news, upgraded to outperform from neutral at Macquarie (price target retained at $16)
+3.8% Superloop (SLC) - No news, retained at buy at Citi (price target retained at $2.40)
+3.7% Hub24 (HUB) - No news, rise is consistent with prevailing long-term uptrend 🔎📈
+3.6% Qantas Airways (QAN) - No news, rise is consistent with prevailing short and long-term uptrends, a regular in ChartWatch ASX Scans Uptrends list 🔎📈
-6.6% Champion Iron (CIA) - No news, generally weaker ASX Resources sector today, iron ore price down last few sessions, fall is consistent with prevailing short and long-term downtrends, a regular in ChartWatch ASX Scans Downtrends list 🔎📉
-5.3% Brainchip (BRN) - Fourth Amendment to LDA Put Option Agreement and Proposed issue of securities
-4.4% Fortescue (FMG) - No news, ditto Resources, ditto iron ore, fall is consistent with prevailing short and long-term downtrends, a regular in ChartWatch ASX Scans Downtrends list 🔎📉
-3.8% Perenti (PRN) - No news, big black candle! ⚠️
-3.7% Bannerman Energy (BMN) - No news, pullback from recent rally
-3.3% Stanmore Resources (SMR) - No news, ditto Resources, coal prices also weaker last few sessions, fall is consistent with prevailing short and long-term downtrends, a regular in ChartWatch ASX Scans Downtrends list 🔎📉
Aristocrat Leisure (ALL)
Retained at buy at Citi; Price Target: $74.00
Amcor (AMC)
Upgraded to buy from neutral at Citi; Price Target: $19.00 from $17.00
AUB Group (AUB)
Retained at overweight at Morgan Stanley; Price Target: $37.05
Car Group (CAR)
Retained at buy at Citi; Price Target: $42.40 from $39.50
Goodman Group (GMG)
Retained at buy at Citi; Price Target: $40.00
Insurance Australia Group (IAG)
Retained at outperform at Macquarie; Price Target: $8.00
IDP Education (IEL)
Upgraded to outperform from neutral at Macquarie; Price Target: $16.00
Light & Wonder (LNW)
Retained at hold at Citi; Price Target: $156.00
Nextdc (NXT)
Retained at buy at Citi; Price Target: $20.00
Rio Tinto (RIO)
Retained at neutral at Citi; Price Target: $134.00
Steadfast Group (SDF)
Retained at overweight at Morgan Stanley; Price Target: $6.98
Superloop (SLC)
Retained at buy at Citi; Price Target: $2.40
Suncorp Group (SUN)
Retained at neutral at Macquarie; Price Target: $17.00
Vicinity Centres (VCX)
Retained at neutral at Citi; Price Target: $2.20
Tue 07 Jan 25, 5:01pm (AEDT)
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