Shares roar back with 2.19pc rally

Biggest one-day rise in 16 months

AUSTRALIA’S share market roared back to life at the end of a volatile week to record its biggest one-day rise in almost 16 months.

The benchmark ASX200 index rallied 2.19 per cent to 6988.1 while the All Ordinaries Index surged 2.13 per cent to 7266.3.

The ASX advance came after four straight days of losses, helping the market recover some ground to be off 2.6 per cent for the week.

Friday’s massive rebound came after the ASX 200 sank into “correction” territory on Thursday (down 10.4 per cent from a record high of 7628.9 points in August) for the first time since the Covid bear market almost two years ago.

Australian shares have fallen 6.1 per cent since the start of the year.

CommSec market analyst Steven Daghlian said investors will need to get used to the market volatility with the prospect of interest rates rising this year,” he said.

“We could see a rate hike in the US as early as March, and in Australia we could see a rate hike around the middle of the year – that’s what markets are expecting.

“The last time rates were hiked in Australia was back in 2010 and it has also been since 2018 when we had rate hikes in the US.”

The Reserve Bank board meets for the first time this year on Tuesday and is expected to keep the official cash rate at 0.1 per cent.

Mirova portfolio manager Amber Fairbanks said the macroeconomic environment was likely to dominate market movements over the next few months.

“We continue to expect heightened volatility,” Ms Fairbanks said.

Every single sector on the ASX was in the green on Friday, led by consumer discretionary stocks.

Dusk Group soared 17.37 per cent to $2.77, Adore Beauty Group rocketed 11.11 per cent to $3.10 – well ahead of its $2.79 price target by UBS – Best and Less jumped 6.77 per cent to $3.47 while Myer leapt 13.33 per cent to 42.5 cents.

Lark Distilling advanced 9.07 per cent to $4.45 after releasing its first-half trading update showing a 78 per cent rise in net sales.

Ord Minnett said the result was pleasing, noting Lark’s search for a new chief operating officer to spearhead the company’s export sales strategy to China, Southeast Asia, the US and Middle East.

In the consumer staples sector, Woolworths added 3.53 per cent to $34.89, Coles gained 5.02 per cent to $16.53 and Metcash lifted 2.56 per cent to $4.

Health stock Imugene soared 10.53 per cent to 31.5 cents after inking a deal with Roche and being granted a patent in Europe, making it the best-performing stock in the ASX200.

In the mining sector, Rio Tinto gained 4.09 per cent to $113.76 and BHP rose 2.74 per cent to $46.92.