Aust shares close at 11-month high | Ralph-Lauren

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Australia’s share market has closed higher and at 11-month highs, as an improved unemployment rate supported investor optimism on day one of Joe Biden’s US presidency.

The S&P/ASX200 benchmark index ended up 53.3 points, or 0.79 per cent, to 6823.7 on Thursday.

The index has not closed above this level since February 25.

The All Ordinaries closed higher by 56.1 points, or 0.8 per cent, at 7107.1.

Information technology was the standout sector, up 2.7 per cent. Afterpay notched a record $149.77, then closed 5.67 per cent higher to $149.00.

The ASX’s rise was helped by US markets, which closed higher as Biden, who has pledged to deliver $US1.9 ($A2.4) trillion in economic stimulus, was sworn in.

Bell Direct market analyst Jessica Amir summed up the mood.

“Investor sentiment is on a tear,” she said.

“We’re at 11-month highs. It’s not just because Joe Biden is getting in, though that does play a part.”

A drop in unemployment will also encourage investors. The rate fell to 6.6 per cent after 50,000 people found jobs in December.

“There is a feeling that the worst is behind us,” Ms Amir said.

“The market is only about four per cent off the (7197.2) high we hit in February last year.”

Biden wasted little time, signing 15 executive actions on the COVID-19 pandemic, the economy, climate change and more.

His economic stimulus plan however must be approved by Congress.

Among the ASX sectors, financials, materials and the consumer sectors gained more than one per cent.

Buy now pay later provider Zip sprung by 23.08 per cent to $7.36 after it claimed an 88 per cent rise in revenue for the December quarter compared to the same 2019 period.

Some of the biggest movers were lithium miners, who may benefit from growing interest in electric cars.

Electric battery researcher Novonix jumped 21.63 per cent to $2.53 after a subsidiary won a $US5.57 million US government grant to better produce lithium-ion batteries.

The subsidiary will work on furnace technology, which could help its manufacturing in the US.

Novonix shares surged earlier this week after hiring a professor working with electric vehicle maker Tesla.

Another lithium provider, AVZ Minerals, rose 13.16 per cent to 21 cents.

Ioneer jumped 11.67 per cent to 34 cents after it said it produced battery-grade lithium hydroxide, used in electric cars, at its US plant.

Ms Amir said investors were interested in lithium due to a move to low carbon economies.

Europe was more advanced in this regard than Australia, she said.

“The lithium price is in a bull run. It’s up about 20 per cent this year,” Ms Amir said.

She urged those thinking of investing to do so carefully.

In banking, each of the big four closed higher by more than one per cent. NAB was best, up 1.63 per cent to $24.30.

In mining, BHP gained 1.56 per cent to $47.02, Fortescue climbed 0.16 per cent to $24.87 and Rio Tinto was better by 1.74 per cent to $121.88.

On Friday, the Australian Bureau of Statistics will release preliminary retail trade figures for December.

Economists expect retail spending to have eased two per cent in December after surging 7.1 per cent to a record $31.7 billion in November.

The Aussie dollar was buying 77.74 US cents at 1709 AEDT, higher from 77.29 US cents at Wednesday’s close.

ON THE ASX

* The S&P/ASX200 benchmark index closed higher 53.3 points, or 0.79 per cent, to 6823.7 on Thursday.

* The All Ordinaries closed higher 56.1 points, or 0.8 per cent, at 7107.1.

* At 1709 AEDT, the SPI200 futures index was even at 6772 points.

CURRENCY SNAPSHOT

One Australian dollar buys:

* 77.74 US cents, from 77.29 cents on Wednesday

* 80.36 Japanese yen, from 80.17 yen

* 64.07 Euro cents, from 63.65 cents

* 56.74 British pence, from 56.58 pence

* 107.82 NZ cents, from 108.35 cents.



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