ASX flat, Westgold affirms guidance, AOFM eyed for new bond; $A off 11-month lows; oil falls towards $US86/barrel

The Australian sharemarket opened higher, tracking a relief rally on Wall Street, after softer US jobs data drove a reversal in bond yields, soothing worries, at least for now, about higher interest rates.

The S&P/ASX 200 rose 0.2 per cent in early trade, after tumbling to its lowest in 11 months on Wednesday in the third straight session of losses.

Stocks are tracking a rebound in the US sharemarket as the Nasdaq jumped 1.4 per cent after ADP data showed that US private payrolls rose 89,000 last month after climbing 180,000 in August. The figure trailed all estimates in a Bloomberg survey of economists.

“Wall Street is looking for any signs that the labour market is cooling and a big miss with the ADP report was somewhat embraced,” said Oanda’s Edward Moya said,

On the ASX 200, energy and utilities were the only two sectors out of the 11 to fall, weighed down by a spectacular 5 per cent drop in crude oil prices overnight. That was the biggest fall in over a year and wiped out its year-on-year gains with oil no longer inflationary.

Karoon Energy was the biggest laggard, tumbling 3.1 per cent and Whitehaven Coal fell 2.2 per cent.

Real estate and healthcare stocks led gains on the ASX and the major banks also rallied between 0.6 per cent and 1 per cent, rebounding from yesterday’s sell-off. Gold miners jumped, while mining heavyweights BHP Group and Fortescue both slid 0.9 per cent. Rio Tinto declined 1.2 per cent.

$A reprieve

Meanwhile, the Australian dollar pulled away from 11-month lows to trade at US63.30¢ after sentiment for risk assets improved. The local currency hit US62.83¢ this week, a level last seen in November last year and has shaved off more than US5¢ since mid-July because of interest rate differentials between the US and Australia.

And Australian bond yields retreated, with the 3-year government yield easing to 4.08 per cent from a 12-week high of 4.17 per cent. The 10-year edged lower to 4.58 per cent from a 12-year peak of 4.68 per cent set on Wednesday, and the 30-year rate also slipped to 4.97 per cent from a record top of 5.06 per cent.

Stocks on the move

ARB fell 0.6 per cent as the shares trade ex-dividend.

Gold producer Newcrest Mining edged up 0.3 per cent after announcing a special fully franked dividend of $US1.1 ($1.58).

Westgold Resources rallied 1.9 per cent after the mining company affirmed its fiscal 2024 guidance after achieving for the first time the full value of the Australian dollar gold price in August and September.

Digital real estate settlement services Property Exchange Australia (PEXA) fell 0.9 per cent to $11 after announcing a planned acquisition of UK-based conveyancing technology provider Smoove for £31 million ($59 million).