The Australian sharemarket opened higher on Tuesday morning, led by real estate, consumer and financial stocks after a strong start to the week on Wall Street. Shares of Premier Investments soared after department store Myer agreed to buy its apparel brands in a close to $1 billion deal.
The S&P/ASX 200 added 26.40 points, or 0.3 per cent, to 8247.90 as of 10.52am AEDT, with eight of the 11 industry sectors in the green. Consumer discretionary stocks gained amid the news of the Myer-Premier tie-up. Oil and gas stocks declined after the price of crude had its biggest drop in more than a year overnight. The gains come after the ASX added 0.1 per cent on Monday.
Wall Street has made a positive start to its week, buoying the local sharemarket.Credit: AP
Solomon Lew’s Premier Investments jumped 17 per cent and Myer shares gained 6.2 per cent after the companies said the department store will take over Premier brands such as Just Group, Jay Jays and Portmans for about $950 million, leaving the fashion retailer to focus on its Smiggle and Peter Alexander chains and giving the billionaire a seat on Myer’s board as non-executive director.
The big four banks also advanced, bolstering the wider market. Commonwealth Bank, the biggest stock on the ASX 200, rose 0.7 per cent. National Australia Bank and Westpac both added 0.7 per cent, and ANZ was up 0.5 per cent.
Tech stocks traded stronger, following gains on Wall Street by Big Tech giants Apple and Instagram parent Meta ahead of their earnings reports this week. WiseTech rose 1.2 per cent, while NextDC and Xero each added 0.6 per cent and Life 360 was up 1.1 per cent.
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On the flipside, Bluescope slumped 6.5 per cent after the nation’s biggest steelmaker slashed its profit forecast for the December half by as much as 35 per cent. Underlying first-half earnings before interest and tax are now expected to come in $270 million to $310 million, down from a previous forecast of between $350 million and $420 million. The company blamed the “challenging operating conditions not only facing BlueScope, but the global steel industry” amid slowing demand from China.
With iron ore the key ingredient of steel, the profit warning limited gains by the mining heavyweights. BHP 0.5 per cent stronger, while Rio Tinto was up 0.3 per cent and Fortescue traded flat.
Energy stocks Woodside and Santos were down 0.8 per cent and 0.4 per cent, respectively, hurt by the sinking oil price. A barrel of benchmark US crude fell 6.1 per cent, and Brent crude, the international standard, slid 6.1 per cent overnight. It was the first trading for them since Israel attacked Iranian military targets on Saturday in retaliation for a barrage of ballistic missiles.
