Evening Wrap: ASX 200 sneaks gain on late-session CBA surge, fresh records for BHP and RIO

The S&P/ASX 200 closed 10.3 points higher, up 0.12%.

The ASX 200 barely edged into positive territory as a last-hour rally in the major banks — led by a partial CBA recovery — offset broad selling across technology, consumer, and gold stocks. Materials held the line with BHP and Rio Tinto closing at record highs for a third consecutive session.

Be sure to 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 economic data in tonight's Evening Wrap. Also, I have detailed technical analysis on the Nasdaq Composite and the S&P/ASX 200 in today's ChartWatch.

Let's dive in!

Markets

ASX 200 Session Chart

The S&P/ASX 200 (XJO) finished 10.3 points higher at 8,640.7, 0.44% from its session low and just 0.04% from its high. But don’t be fooled by that gain in the benchmark, the broader market was down today — with advancers lagging decliners by 117 to 167.

Financials (XFJ) (+1.0%) recovered modestly as a final hour surge in Commonwealth Bank (CBA) (+1.8%) delivered the sector a stronger close, and the XJO an end of day gain. The XFJ sector index added 0.8% between 2:50pm and the close as CBA rallied 1.5%.

S&P-ASX 200 Financials (XFJ) intraday chart 14 May

CBA plunged over 10% yesterday on the back of a small miss in its third quarter update, but also on the major changes to taxation of property investment, to which the bank has the largest exposure of any of its peers. That move wiped $30 billion from the value of the ASX’s once-biggest stock. Today, some comfort for shareholders.

Commonwealth Bank of Australia (CBA) intraday chart 14 May

Putting aside CBA's late heroics, Macquarie Group (MQG) (+3.3%) was the session's standout financial, with ANZ (ANZ) (+0.8%) and Westpac (WBC) (+0.4%) both firmer. National Australia Bank (NAB) (-1.2%) was the lone major bank to finish lower.

Utilities (XUJ) (+0.8%) as benchmark Australian bond yields dipped nearly 5 basis points after investors had more time to digest the federal budget's inflationary implications — lower yields reduce competition for income-generating assets, making utilities comparatively more attractive. Origin Energy (ORG) (+1.1%), AGL Energy (AGL) (+0.7%), and APA Group (APA) (+0.4%) were all firmer.

Real Estate (XPJ) (+0.2%) added modestly to Wednesday's budget-driven gains, again helped by the yield retreat. Residential developers continue to benefit from the government's new housing initiatives.

Materials (XMJ) was flat at the sector level, masking a sharp split. The major diversifieds closed at records — BHP (BHP) (+0.9%) hit an all-time closing high for a third consecutive session and Rio Tinto (RIO) (+1.6%) matched it — while Fortescue (FMG) (+2.1%) also advanced strongly. Despite COMEX copper and LME aluminium both setting all-time highs overnight, most base and industrial metals stocks pulled back in profit-taking.

Rare earths stocks were sharply lower despite NdPr prices in China rising 1.0% to CNY 747,500/t. Lynas Rare Earths (LYC) (-9.8%), Arafura Rare Earths (ARU) (-9.5%), and Iluka Resources (ILU) (-2.2%) all fell. No news for any of them, the moves possibly reflecting a reversal in strategic minerals sentiment.

Information Technology (XIJ) (-2.2%) was the session's worst performer, hit by a combination of Xero's (XRO) (-9.0%) full-year results and a broader sell-off in high-P/E, long-duration technology stocks. The release of Claude for Small Business by AI developer Anthropic appeared to reinforce investor concerns about competitive pressure on enterprise software companies. WiseTech Global (WTC) (-4.8%), Technology One (TNE) (-2.9%), and Catapult Sports (CAT) (-2.8%) were all lower.

S&P-ASX 200 Information Technology (XIJ) intraday chart 14 May

Consumer Staples (XSJ) (-1.9%) remained under pressure from multiple directions. Coles (COL) (-2.2%) fell after the ACCC won a landmark Federal Court case finding the supermarket misled shoppers over discount pricing in store promotions. Woolworths (WOW) (-1.3%) was pulled lower in sympathy. GrainCorp (GNC) (-13.5%) was the sector's sharpest faller after its first-half profit collapsed on global grain market oversupply. A2 Milk Company (A2M) (-3.2%) was also lower.

Health Care (XHJ) (-1.0%) remained under pressure with Pro Medicus (PME) (-3.1%) and Cochlear (COH) (-4.6%) extending the sector's brutal run.

Energy (XEJ) (-0.8%) drifted lower as crude and coal futures retreated, and uranium stocks continued to sell off. Paladin Energy (PDN) (-3.8%), Whitehaven Coal (WHC) (-1.7%), Karoon Energy (KAR) (-1.0%), and Woodside Energy (WDS) (-0.8%) were all lower. ICE Brent crude futures were flat at US$105.67/bbl after falling around 2% overnight.

GFEX lithium carbonate futures dropped 2.0% to CNY 197,780/t and Australian spodumene concentrate fell 1.5% to US$2,900/t, with lithium stocks retreating — Elevra Lithium (ELV) (-4.9%), IGO (IGO) (-2.8%), and Liontown Resources (LTR) (-2.7%) were all lower. NdPr in China rose 1.0% to CNY 747,500/t — though rare earths stocks moved sharply in the opposite direction.

Today's best gainers in the ASX 300

Today's worst losers in the ASX 300

ChartWatch

Nasdaq Composite Index

Analysis

Really not a great deal to add here. Wednesday’s candle is exactly what we would have expected from the candles, price action and trends that preceded it.

This is trend following at its finest. 💪

Volume remains modestly above average — there’s a decent whack of engagement from both the demand and supply sides here.

The above average volume of buyers on Wednesday were clearly motivated (white bodied candle with close near session’s high, good progress from Tuesday’s close). FOMO? Hey, it wasn’t crazy, but its still there, bubbling away and supporting this amazing rally. ✅

The above average volume of sellers were clearly less motivated… Happy to step back, and back, in the expectation they’d get better prices by waiting. HOFU? Yes, I would say so. ✅

Importantly, Tuesday’s dip was viewed as a buying opportunity and not the start of something bigger. BTD? Definitely. ✅

The only word of caution, at is very mild at this stage — something that I'm alert about but am far from alarmed about — is the above average volume occurring here: after a massive run.

Volume is buying and selling. Above average volume into new highs, as an already fantastic uptrend extends speaks of continued high interest among the demand side, but also willing engagement by the supply side.

That in itself suggests less than a perfect consensus in the demand supply environment. I.e., that those with cash should be in stocks and those already in stocks should remain there.

Monitoring it. 🧐 No change to my risk settings!

(Please understand that if “the big one” is coming… like so many deep value experts claim daily… I will NEVER be able to tell you in advance. 100% I will be FRP at the top. And that’s okay with me. 🧘 This is because I don’t fear a crash… I’ll see the signs quickly enough to get my risk out before there’s too much damage — this I do know… What I fear the most is not following the trend and missing out on gains that my model is designed to capture. We’re all driven by our unique fears… You just need to decide if yours are those of the Chicken Little’s telling us "it’s gone up too much", or those of a trend follower with a risk management plan! 😉).

View

FRP (RP = Risk Position — it reflects my personal allowable capital allocation limit for my investments in US stocks. So 1/2RP is 50%, 2/3RP is 67% and FRP is 100% 🪣). I don't know what's going to happen next, only that right now, the chart above remains a picture of excess demand.

Key levels

There are no key supply zones to contend with. The old all-time high supply zone of 23722-24020 will likely act as a short term zone of demand, however the short-term trend ribbon (presently 24473-25052) is now the key zone of demand. If the price closes back below this range, the supply-side is very likely back in control of the Comp's price.

S&P/ASX 200 (XJO)

Analysis

Analysis? 🤔

= Old Tin Pot... Nothing to see here! 🤦

We just have to Accept it and get on with our lives! 😭

View

Act: I remain 1/2RP 🪣 on the OTP (i.e., my personal allowable capital allocation limit for my investments in Australian stocks is 50%).

Key levels

9022 is the key point of supply. Beyond that, it's the 9201, the all time high. The OTP is below the long-term downtrend ribbon (presently 8688-8754) — definitely not a good look! A close below 8590-8621 could trigger a retracement back to the 8262-8379 lows.

(Glossary of acronyms! Old Tin Pot (OTP): S&P/ASX 200 | MOTN: More Often Than Not | FOMO: Fear Of Missing Out | HOFU: Holding On For Upside | BTD: Buy The Dip | STR: Sell The Rally | RP: Risk Position)

Economy

Today

• There weren't any major economic data releases in our time zone today

Later this week

Thursday

• 20:30 USA April Core Retail Sales (+0.6% m/m forecast vs +1.9% m/m in March)

Friday

• 21:15 USA April Capacity Utilization Rate (75.8% forecast vs 75.7% in March)

• 21:15 USA April Industrial Production (+0.2% m/m forecast vs -0.5% m/m in March)

Latest News

Interesting Movers

Trading higher

• +27.7% Megaport (MP1) - secured $254 million in long-term network and storage contracts across three agreements with two US-based customers, representing $90.6 million in annualised recurring revenue, with UBS flagging the win as likely to prompt earnings upgrades.

• +2.3% Worley (WOR) - announced a new $300 million share buyback, following the completion of a $500 million buyback program three weeks earlier.

• +2.1% ASX Ltd. (ASX) - appointed Euronext executive Anthony Attia as chief executive from September 1, following a global search process triggered by the departure of Helen Lofthouse.

Trading lower

• -18.4% Bapcor (BAP) - downgraded full-year EBITDA guidance to $144–150 million, citing weak conditions driven by the Iran war.

• -13.5% GrainCorp (GNC) - first-half profit fell to $33 million from $69 million in the prior corresponding period, with global grain market oversupply and weak pricing compressing margins across the supply chain.

• -9.0% Xero (XRO) - reported full-year net profit of $NZ167.4 million, down year-on-year, with the $4 billion acquisition of Melio weighing on profitability; adjusted EBITDA rose 18% to $757 million, coming in approximately 2% ahead of consensus, while the net profit miss reflected higher-than-expected interest costs and taxes.

• -2.2% Coles (COL) - the ACCC won a landmark Federal Court case finding the supermarket misled shoppers over discount pricing in store promotions.

Broker Moves

Aristocrat Leisure (ALL)

• Retained at buy at Bell Potter; Price Target: $61.00

• Retained at buy at Citi; Price Target: $61.00 from $65.00

• Retained at overweight at JPMorgan; Price Target: $61.00 from $62.00

• Retained at outperform at Macquarie; Price Target: $60.00 from $63.00

• Retained at overweight at Morgan Stanley; Price Target: $59.80

• Retained at buy at Morgans; Price Target: $67.00 from $63.00

• Retained at buy at Ord Minnett; Price Target: $61.00 from $65.00

• Retained at buy at UBS; Price Target: $68.90

ALS (ALQ)

• Retained at buy at Morgans; Price Target: $27.20 from $25.30

ANZ Group Holdings (ANZ)

• Retained at neutral at Macquarie; Price Target: $33.50

Bapcor (BAP)

• Retained at neutral at Citi; Price Target: $0.76

Breville Group (BRG)

• Retained at buy at Morgans; Price Target: $36.75 from $40.65

• Retained at buy at UBS; Price Target: $36.00

Commonwealth Bank of Australia (CBA)

• Retained at underperform at CLSA; Price Target: $130.00 from $142.00

• Retained at underperform at Macquarie; Price Target: $117.00

• Retained at underweight at Morgan Stanley; Price Target: $130.00 from $131.00

• Retained at sell at Morgans; Price Target: $119.40 from $124.26

Credit Clear (CCR)

• Retained at buy at Shaw and Partners; Price Target: $0.40

Codan (CDA)

• Upgraded to outperform from neutral at Macquarie; Price Target: $44.20 from $42.00

Coronado Global Resources Inc (CRN)

• Retained at hold at Ord Minnett; Price Target: $0.26 from $0.36

Develop Global (DVP)

• Retained at buy at Bell Potter; Price Target: $7.10 from $6.60

EBR Systems Inc (EBR)

• Retained at buy at Morgans; Price Target: $2.47

Evolution Mining (EVN)

• Retained at neutral at UBS; Price Target: $13.80

Flight Centre Travel Group (FLT)

• Retained at overweight at Morgan Stanley; Price Target: $16.00

Healius (HLS)

• Retained at neutral at Macquarie; Price Target: $0.39 from $0.78

• Retained at hold at Morgans; Price Target: $0.41 from $0.80

• Downgraded to underperform from sector perform at RBC Capital Markets; Price Target: $0.35 from $0.75

James Hardie Industries Plc (JHX)

• Retained at buy at Citi; Price Target: $42.60

• Retained at overweight at Morgan Stanley; Price Target: $44.00

Mader Group (MAD)

• Retained at buy at Bell Potter; Price Target: $9.70

Microba Life Sciences (MAP)

• Retained at speculative buy at Morgans; Price Target: $0.15 from $0.29

Megaport (MP1)

• Retained at buy at UBS; Price Target: $14.65

National Australia Bank (NAB)

• Retained at neutral at Macquarie; Price Target: $40.50

NRW Holdings (NWH)

• Retained at outperform at Macquarie; Price Target: $8.10 from $6.90

Omega Oil & Gas (OMA)

• Initiated at speculative buy at Bell Potter; Price Target: $1.45

Orezone Gold Corporation (ORE)

• Retained at buy at Canaccord Genuity; Price Target: $5.00

Paladin Energy (PDN)

• Retained at sell at Ord Minnett; Price Target: $9.50 from $9.75

Pro Medicus (PME)

• Retained at buy at Ord Minnett; Price Target: $210.00 from $220.00

Pioneer Credit (PNC)

• Retained at buy at Shaw and Partners; Price Target: $1.00

Ramsay Health Care (RHC)

• Retained at outperform at Macquarie; Price Target: $43.40

Stealth Group Holdings (SGI)

• Initiated at buy at Ord Minnett; Price Target: $1.30

Smartgroup Corporation (SIQ)

• Retained at equal-weight at Morgan Stanley; Price Target: $11.00 from $9.10

Smart Parking (SPZ)

• Retained at buy at Shaw and Partners; Price Target: $1.55

Santos (STO)

• Retained at buy at Citi; Price Target: $8.65

Temple & Webster Group (TPW)

• Retained at neutral at Citi; Price Target: $5.60 from $8.00

• Downgraded to neutral from overweight at Jarden; Price Target: $6.60 from $10.90

• Retained at buy at Jefferies; Price Target: $8.95 from $14.50

• Downgraded to underweight from neutral at JPMorgan; Price Target: $4.00 from $8.70

• Downgraded to neutral from outperform at Macquarie; Price Target: $4.75 from $13.70

• Retained at overweight at Morgan Stanley; Price Target: $24.00

• Retained at hold at Ord Minnett; Price Target: $6.40

Westpac Banking Corporation (WBC)

• Retained at underperform at Macquarie; Price Target: $31.00

Woodside Energy Group (WDS)

• Retained at neutral at Citi; Price Target: $33.25

Wisetech Global (WTC)

• Retained at outperform at CLSA; Price Target: $116.00

• Retained at buy at Jefferies; Price Target: $72.00

• Retained at outperform at RBC Capital Markets; Price Target: $70.00

• Retained at buy at UBS; Price Target: $67.00

Xero (XRO)

• Retained at buy at UBS; Price Target: $127.00

Scans