Miners rescue the war-torn ASX yet again

Miners rescue the war-torn ASX yet again

Once again, it was the old school miners who rode to the rescue of the Australian share market, helping to overcome the worst effects of higher oil prices and a flare-up in the Middle East war.

By the market close on Friday, the ASX 200 had overcome the worst of a four-day losing streak, closing up 43.5 points, or 0.5%, at 8806 points.

Banks, miners and real estate save the day

Only three of the 11 sectors were higher but they were the heavyweight ones – materials, financials and real estate, which was enough to turn the entire market higher.

That left the ASX 200 benchmark down just 0.5 % for the week—not a bad result considering the week contained more airstrikes, an end to the fragile ceasefire and the reimposition of US oil sanctions on Iran.

That’s a fairly toxic mix considering doubts over the safety of transported energy and other commodities through the Strait of Hormuz, rising inflationary pressures and fears that interest rates might march higher.

Copper lifts the load

The latest commodity to do the heavy lifting is copper, which buoyed the share prices of materials stocks as gold miners also lifted on fears of higher inflation. Shares in South32 (ASX: S32) jumped an impressive 5.2% in the wake of a 14% rise in the price of copper. It was a similar picture for the diversified Rio Tinto (ASX: RIO) shares were up 3.8% to $164.49 while shares in BHP (ASX: BHP) rose 2.5% to $58.28. On the gold side, Evolution Mining shares (ASX: EVN) enjoyed the firmer gold price with a 3.4% rise to $11.63.

Uranium and banks join the party

Even uranium stocks joined the party after Australia and India finalised an agreement enabling long-term Australian exports, with Paladin Energy shares (ASX: PDN) up 4.1% to $10.06, while Deep Yellow shares (ASX: DYL) rose an impressive 7.4% to $1.44. The heavyweight banks were also back in favour, with National Australia Bank shares (ASX: NAB) up 0.8% to $39.61, Commonwealth Bank shares (ASX: CBA) adding 0.5% to $168.86, Westpac shares (ASX: WBC) up 0.9% to $36.54, while ANZ shares (ASX: ANZ) added 0.8% to $36.05. Oil and gas stocks lost some ground as the oil price stayed flat, with Santos shares (ASX: STO) down 0.4% to $7.62, Woodside Energy (ASX: WDS) shares down 0.9% to $29.05, while Beach Energy shares (ASX: BPT) firmed a skinny 0.6% to 88c.

Defensive stocks falter

As usual, when cyclicals go higher, defensive shares such as healthcare fell, with Pro Medicus (ASX: PME) ending a strong 33% monthly run up with a 6.3% fall to $197.07, while the recovering CSL (ASX: CSL) also lost some ground, down 2.1% to $122.89. One strongly rising share was Bravura Solutions (ASX: BVS), which flew upwards by 15.1% to $2.36 after boosting its 2026 financial year earnings guidance to $77 million, compared to its previous guide of $69 million to $73 million. Not so lucky were shares in Ingenia Communities (ASX: INA), which fell 0.5% to $4.34 after management confirmed it is in discussions with Peet over a possible transaction. Shares in Peet (ASX: PPC) rose 4.7% to $1.78. Shares in Sandfire Resources (ASX: SFR) added 3.8% to $18.83 after it increased the planned mine life of its Black Butte copper project in Montana to 12 years after declaring a maiden ore reserve for the Lowry deposit.

The week ahead

While the progress on the newly revved up Middle East war will be a big factor in the coming week, the ramping up of the US second quarter earnings season will also be closely watched.

Many of the major US banks are reporting in the coming week with investors hoping that the recent 16% run up in the price of financials on the back of expected interest rate rises will be supported by some hard numbers.

Unlike Australian banks, those in the US can quickly jack up mortgage and credit card rates and go slow on deposit rate rises, quickly improving their profit margins.

Airline profits in focus

Investors will also be keeping a close eye on the results from airlines, with recent share price rises set to rise or fall depending on the profit numbers.

The really big numbers from the US megacap technology companies are due the following week and come pre-loaded with stellar expectations of second quarter earnings growth of around 50%, which feeds back into providing the bulk of the growth expected from the S&P 500.

US CPI figures will also be of interest, along with testimony by the new US Federal Reserve Chairman, Kevin Warsh, before a government committee, which will be watched for any hints about the future direction of official interest rates.

Locally, figures on inflation expectations, consumer sentiment and business confidence will be closely watched, as will a number of company updates.

Some of the updating companies include Ampol, Auckland International Airport, Evolution Mining, Rio Tinto, AMP, BHP, and Netwealth.

Alcoa’s second quarter results are also due on Thursday.