Evening Wrap: ASX 200 surges 113 points on blue chip bonanza as BHP, RIO, FMG, ANZ, CBA, NAB and WBC climb

The S&P/ASX 200 closed 113.1 points higher, up 1.30%.

The ASX 200 surged to its biggest single-session gain in a month as President Trump paused the US's naval escort operation through the Strait of Hormuz in a bid to push Iran toward a peace deal. That sent oil lower, and risk assets higher. The big banks and big miners were the big winners today, as a weak underbelly of Aussie stocks continued to lose ground.

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 113.1 points higher at 8,793.6 — smack bang on its session high and 1.3% from its low. In the broader-based S&P/ASX 300 (XKO) advancers beat decliners by 170 to 121.

Financials (XFJ) (+2.4%) led the index higher as arguably, the ASX's underperformance against US markets reached a point where local fund managers had little choice but to engage. They did so in the safest, most liquid place available: the major banks and mining companies. In the former, Westpac (WBC) (+3.5%), ANZ (ANZ) (+3.1%), Commonwealth Bank (CBA) (+3.0%), and National Australia Bank (NAB) (+2.8%) all surged.

Materials (XMJ) (+2.5%) was the other engine of the rally. Iron ore stocks were the primary driver as SGX benchmark iron ore futures rose 1.5% to US$110.15/t — on track for their best weekly close since June 2024. Fortescue (FMG) (+3.1%), BHP (BHP) (+3.1%), and Rio Tinto (RIO) (+2.3%) all posted strong gains.

Consider today's powerhouse moves in these sectors are a sudden about-face to their fortunes heading into today — banks increasingly on the back foot due to poorly received trading updates, and resources softer on fears that high energy prices would choke global growth and mining company profits.

Iron Ore 62- (Front month, back-adjusted) SGX chart 6 May

Lithium stocks resumed trading after Chinese markets reopened from the Labor Day holiday break — and made up for lost time. GFEX benchmark lithium carbonate futures surged 6.7% to their best level since August 2023, while Australian spodumene concentrate in China rose 7.6% to US$2,755/t. PMET Resources (PMT) (+10.7%), Elevra Lithium (ELV) (+7.6%), IGO (IGO) (+6.6%), Liontown Resources (LTR) (+6.3%), Mineral Resources (MIN) (+4.0%), and Pilbara Minerals (PLS) (+3.3%) all surged.

GFEX Lthium Carbonate Futures chart

Rare earths and critical minerals stocks also rebounded strongly alongside the broader mining bid tone. Metals X (MLX) (+5.0%), Lynas Rare Earths (LYC) (+3.6%), and Arafura Rare Earths (ARU) (+2.9%) were all firmer.

The Gold Sub-Index (XGD) (+1.2%) rallied as precious metals prices recovered alongside the pullback in crude oil. COMEX gold futures rose 2.3% to US$4,675/oz as the oil-gold inverse relationship that has defined this crisis reasserted itself. Kingsgate Consolidated (KCN) (+6.4%), Emerald Resources (EMR) (+4.5%), and West African Resources (WAF) (+3.1%) were the standout movers.

Real Estate (XPJ) (+0.6%) was carried higher largely by the weight of Goodman Group (GMG) (+2.9%) in the index, with the broader sector benefiting from yesterday's post-RBA yield retreat.

Energy (XEJ) (-2.0%) was the session's worst performer despite the broader risk-on tone, sliding as ICE Brent crude futures fell 1.9% to US$107.75/bbl on President Trump's announcement that Project Freedom would be paused. Viva Energy (VEA) (-3.3%), Woodside Energy (WDS) (-2.7%) were among the oil and gas fallers.

Coal stocks were also dragged lower, with New Hope Corp. (NHC) (-3.4%) and Yancoal Australia (YAL) (-3.3%) both declining. Uranium stocks fell sharply, tracking overnight losses in global uranium majors — Bannerman Energy (BMN) (-4.7%), Deep Yellow (DYL) (-4.2%), and NexGen Energy (NXG) (-3.6%) were all hit hard.

Information Technology (XIJ) (-0.5%) pulled back despite strong leads from the Nasdaq, dragged by sector heavyweight WiseTech Global (WTC) (-2.2%), as Life360 (360) (-5.9%) and Objective Corp. (OCL) (-4.4%) also lost ground.

Health Care (XHJ) (-0.9%) continued its extended underperformance — the worst-performing major sector over the past 12 months. 4DMedical (4DX) (-5.5%), Pro Medicus (PME) (-2.6%), and Cochlear (COH) (-2.4%) were all lower.

Consumer Discretionary (XDJ) (-0.6%) remained under pressure as yesterday's rate rise continued to weigh on sentiment toward spending-sensitive stocks. JB Hi-Fi (JBH) (-6.3%) was the heaviest faller after its supplier cost warning. The Lottery Corp. (TLC) (-5.0%) and Universal Store (UNI) (-3.9%) were also lower.

Today's best gainers in the ASX 300

Today's worst losers in the ASX 300

ChartWatch

Nasdaq Composite Index

Analysis

Super solid. No change to the analysis (trends ✅ + price action ✅ + candles ✅ + volume ✅). Therefore, no change to the risk management here. More analysis in today’s ChartWatch webinar (link below).

In the meantime, you know the drill... the fingerprints of excess supply to watch out for are:

• Black-bodied candles and or upward pointing shadows = pervasive sell orders, STR ⚠️

• Lower peaks, lower troughs = STR + FOMO is now fear of holding on + HOFU is now sell first ask questions later! ⚠️

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 23773-24214) 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

A positive development today, assuming you're not too fussed that most of that white candle exists because of four big banks and 3 mining companies.

Is this the resumption of the rally that started at 8262? It very well could be. The foundations are in place:

• The long term trend ribbon has pretty much held (squint, tilt your head sideways... it has, right!?).

• Today's emphatic demand side candle closed at its session high, and above the critical short- and long-term trend ribbons.

• A move back to rising peaks and rising troughs here would set 8621 as a higher major point of demand.

Perhaps I'm getting a little ahead of myself on that last one! 😉

As I noted in today's webinar, it wouldn't take much to find ourselves at a point that requires us putting more risk to work here. Let's see a trough set above the trend ribbons, better still, a strong candle closing near 8987-9022 to suggest the latent supply up there is well on the way to being consumed...

Again... getting ahead of myself!

View

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. 8621 is now the critical point of demand. Quite simple now — as long as it stays above that, some credibility to the rally started at 8262, but below it = likely 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)

***NEW VIDEO DROPPED 📺***

ASX tech stocks flagging AGGRESSIVE buy signals, plus big banks, iron ore stocks, lithium & more!

Economy

Today

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

Later this week

Thursday

• No major economic news announcements scheduled for this day

Friday

• 00:00 USA April Non-Farm Payrolls

  • Employment change: +60,000 forecast vs +178,000 in April

  • Average Hourly Earnings: +0.3% m/m forecast vs +0.2% m/m in March)

  • Unemployment Rate: unchanged at 4.3% forecast

Saturday

• 00:00 USA April Preliminary University of Michigan Consumer Sentiment (49.3 forecast vs 49.8 in March)

Latest News

Interesting Movers

Trading higher

• +25.0% DigiCo Infrastructure REIT (DGT) - announced the sale of its Chicago data centre site for $1 billion, with proceeds to be directed toward expanding its flagship Sydney facility as the company exits North American locations.

• +17.0% HMC Capital (HMC) - surged on the DigiCo Chicago sale announcement, in which HMC holds approximately a 20% stake, alongside a major overhaul of HMC's asset management business.

• +0.6% Atlas Arteria (ALX) - board told shareholders to reject IFM Investors' $6.9 billion hostile takeover bid.

• +0.4% AGL Energy (AGL) - upgraded earnings guidance at the Macquarie Australia Conference and flagged it could withstand fuel supply disruptions for at least three months thanks to near-full diesel storage.

Trading lower

• -8.9% Magellan Financial (MFG) - extended Tuesday's losses following its announcement that it is handing its $5.3 billion Global Equities funds to Vinva Investment Management and scrapping performance fees entirely.

• -6.3% JB Hi-Fi (JBH) - CEO Nick Wells warned of significant supplier component cost increases and product shortages driven by the global data centre construction boom.

• -4.1% Vault Minerals (VAU) - continued to sell off following Tuesday's merger announcement with Regis Resources.

• -3.6% Regis Resources (RRL) - also fell further following Tuesday's merger announcement, with investors continuing to reassess the terms of the $10.7 billion deal.

• -2.7% Breville Group (BRG) - fell despite CEO Jim Clayton's Macquarie Australia Conference assurances that the company's premium product positioning insulates it from consumer spending pressure, with investors unconvinced by the message.

• -1.0% GPT Group (GPT) - trading update reiterated full-year guidance but revealed office portfolio occupancy slipped to 92.2%, down 1% on the prior annual result.

Broker Moves

Astral Resources NL (AAR)

• Retained at buy at Shaw and Partners; Price Target: $0.45

Amplitude Energy (AEL)

• Retained at outperform at Macquarie; Price Target: $2.80

AGL Energy (AGL)

• Retained at neutral at Macquarie; Price Target: $9.34

Aristocrat Leisure (ALL)

• Retained at buy at Bell Potter; Price Target: $61.00 from $70.00

Atlas Arteria (ALX)

• Retained at equal-weight at Morgan Stanley; Price Target: $4.71

Ansell (ANN)

• Retained at equal-weight at Morgan Stanley; Price Target: $29.30 from $34.40

APA Group (APA)

• Retained at outperform at Macquarie; Price Target: $10.41

ARB Corporation (ARB)

• Retained at neutral at Citi; Price Target: $22.05

• Retained at buy at Ord Minnett; Price Target: $31.00

Arena REIT (ARF)

• Retained at outperform at Macquarie; Price Target: $3.90

Accent Group (AX1)

• Retained at buy at Morgans; Price Target: $0.75 from $0.94

Aurizon Holdings (AZJ)

• Retained at underweight at Morgan Stanley; Price Target: $3.50

BWP Trust (BWP)

• Retained at buy at Citi; Price Target: $4.00

Charter Hall Group (CHC)

• Retained at outperform at Macquarie; Price Target: $20.71

COG Financial Services (COG)

• Retained at buy at Shaw and Partners; Price Target: $2.45

Cochlear (COH)

• Retained at equal-weight at Morgan Stanley; Price Target: $119.00

Computershare (CPU)

• Upgraded to neutral from underperform at Bank of America; Price Target: $34.20 from $32.50

• Retained at buy at Citi; Price Target: $37.60

• Retained at neutral at UBS; Price Target: $33.00 from $32.75

CSL (CSL)

• Retained at overweight at Morgan Stanley; Price Target: $198.00 from $215.00

Cleanaway Waste Management (CWY)

• Retained at overweight at Morgan Stanley; Price Target: $2.91

Dalrymple Bay Infrastructure (DBI)

• Retained at outperform at Macquarie; Price Target: $5.39

• Downgraded to hold from buy at Morgans; Price Target: $5.31 from $5.35

Dexus (DXS)

• Retained at neutral at Citi; Price Target: $7.80

• Retained at outperform at Macquarie; Price Target: $6.91

• Retained at underweight at Morgan Stanley; Price Target: $6.47

Endeavour Group (EDV)

• Retained at underperform at Macquarie; Price Target: $3.40

• Retained at lighten at Ord Minnett; Price Target: $2.90

Elders (ELD)

• Retained at outperform at Macquarie; Price Target: $8.50

• Retained at neutral at UBS; Price Target: $7.30

Flight Centre Travel Group (FLT)

• Retained at buy at Citi; Price Target: $14.15 from $16.75

• Retained at outperform at CLSA; Price Target: $16.70

• Retained at positive at E&P; Price Target: $19.14 from $19.66

• Retained at overweight at Jarden; Price Target: $16.80 from $16.70

• Retained at buy at Jefferies; Price Target: $15.00 from $17.50

• Retained at outperform at Macquarie; Price Target: $17.95

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

• Retained at buy at Morgans; Price Target: $14.55 from $18.05

Fortescue (FMG)

• Retained at outperform at Macquarie; Price Target: $22.00

Fisher & Paykel Healthcare Corporation (FPH)

• Retained at overweight at Morgan Stanley; Price Target: $32.80 from $37.30

FleetPartners Group (FPR)

• Retained at overweight at Morgan Stanley; Price Target: $3.60

GPT Group (GPT)

• Retained at buy at Citi; Price Target: $6.00

• Retained at outperform at Macquarie; Price Target: $4.97

Gentrack Group (GTK)

• Retained at buy at Bell Potter; Price Target: $5.60 from $8.80

• Retained at equal-weight at Morgan Stanley; Price Target: $7.70

Infratil (IFT)

• Retained at buy at Citi; Price Target: $12.34

LinQ Minerals (LNQ)

• Retained at speculative buy at Bell Potter; Price Target: $0.90

Liontown (LTR)

• Retained at neutral at Macquarie; Price Target: $2.20

Lynas Rare Earths (LYC)

• Retained at neutral at Macquarie; Price Target: $20.00

McMillan Shakespeare (MMS)

• Retained at overweight at Morgan Stanley; Price Target: $19.00

Nine Entertainment Co. Holdings (NEC)

• Upgraded to buy from overweight at Jarden; Price Target: $1.15 from $1.30

NRW Holdings (NWH)

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

Pinnacle Investment Management Group (PNI)

• Retained at buy at Ord Minnett; Price Target: $22.10 from $21.80

Pantoro Gold (PNR)

• Retained at hold at Bell Potter; Price Target: $3.55 from $4.20

Qualitas (QAL)

• Retained at outperform at Macquarie; Price Target: $4.16

Qantas Airways (QAN)

• Retained at outperform at Macquarie; Price Target: $11.00

Qube Holdings (QUB)

• Retained at equal-weight at Morgan Stanley; Price Target: $5.15

Ramsay Health Care (RHC)

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

• Retained at underweight at Morgan Stanley; Price Target: $32.90 from $35.60

Ramelius Resources (RMS)

• Retained at buy at Morgans; Price Target: $6.10 from $6.21

Regis Resources (RRL)

• Retained at neutral at Citi; Price Target: $8.10

• Retained at buy at UBS; Price Target: $8.75

SGH (SGH)

• Retained at outperform at Macquarie; Price Target: $50.40

Stockland (SGP)

• Retained at outperform at Macquarie; Price Target: $4.42

Sigma Healthcare (SIG)

• Downgraded to accumulate from buy at Morgans; Price Target: $3.30 from $3.36

• Retained at buy at Ord Minnett; Price Target: $3.40 from $3.30

Smartgroup Corporation (SIQ)

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

Transurban Group (TCL)

• Retained at equal-weight at Morgan Stanley; Price Target: $14.10

The Lottery Corporation (TLC)

• Retained at overweight at Morgan Stanley; Price Target: $5.70

Telix Pharmaceuticals (TLX)

• Retained at overweight at Morgan Stanley; Price Target: $22.40 from $24.60

Universal Store Holdings (UNI)

• Retained at buy at Bell Potter; Price Target: $9.30 from $10.50

• Retained at overweight at Jarden; Price Target: $8.80 from $10.00

• Retained at outperform at Macquarie; Price Target: $10.30

• Retained at buy at Morgans; Price Target: $9.50 from $9.60

• Retained at buy at UBS; Price Target: $9.00 from $9.50

Vicinity Centres (VCX)

• Retained at underweight at Morgan Stanley; Price Target: $2.63

Westpac Banking Corporation (WBC)

• Retained at hold at CLSA; Price Target: $34.90 from $38.20

• Downgraded to sell from underweight at Jarden; Price Target: $31.00 from $32.00

• Retained at underweight at JPMorgan; Price Target: $35.90 from $37.30

• Retained at underperform at Macquarie; Price Target: $31.00 from $32.00

• Retained at neutral at UBS; Price Target: $40.00

Wisetech Global (WTC)

• Retained at buy at Bell Potter; Price Target: $78.75

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

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

• Retained at outperform at Macquarie; Price Target: $97.70

Scans