Friday delivered more of the same, with the ASX unable to hold Thursday’s recovery as a fresh wave of selling hit the materials sector. The culprit this time wasn’t just the Middle East – China’s state-backed iron ore buyer CMRG effectively banned traders from purchasing new BHP cargoes, sending the Big Australian down sharply and dragging the broader resources complex with it. It was a messy session to end a soft week, though there were some genuine bright spots. Tech continued its strong bounce and MFG added further gains as the Lowy Family’s cornerstone stake gave the Barrenjoey merger story more legs.
For the week, the ASX shed 3.78%, its worst weekly performance since the RBA’s shock rate rise in May 2022, as the Iran conflict rewired the global macro picture almost overnight. Oil surging 16% in a week, bond markets pricing in two-plus RBA hikes and a USD hitting its best week since late 2024 — this is a different market to the one we started the week in. The duration of the conflict remains the key variable from here.
- The ASX200 fell -95pts/-1.06% to close at 8,851
- Best performing sectors were IT (+4.57%), Communications (+1.52%) and Consumer Discretionary (+0.51%)
- Worst were Materials (-4.00%), REITs (-0.58%) and Financials (-0.44%)
- A week to forget for most investors, with the ASX 200 shedding 3.78% — its worst week since May 2022. The Iran conflict completely reshuffled the sector leadership table in the space of just five sessions:
- Best sectors for the week: Energy (+7.43%), IT (+3.33%), Communications (+1.06%) and Staples (+0.56%) — energy the obvious beneficiary while tech found its footing after months of selling pressure
- Worst sectors for the week: Materials (-8.52%), Real Estate (-4.51%), Consumer Discretionary (-4.20%) and Financials (-3.26%) — resources and rate-sensitives bore the brunt
- Best stocks for the week: MFG +36.5%, Viva Energy +18.6%, Karoon Energy +17.5%, DroneShield +12.4%, WiseTech +10.9% — energy, defence and tech the clear themes
- Worst stocks for the week: Deep Yellow -17.5%, Catalyst Metals -17.3%, Sandfire -15.4%, Westgold -14.5%, Life360 -11.0% — gold miners and materials stocks dominated the losers board
- BHP (BHP) -4.2% — the standout negative story of the day after China’s CMRG effectively ordered traders to stop purchasing new BHP cargoes, citing breaches of purchase restrictions. This isn’t a formal ban but CMRG’s political clout makes it effectively binding. The overhang on BHP is real until this standoff is resolved
- Rio Tinto (RIO) -3.6% and Fortescue (FMG) -0.7% also caught in the crossfire, though FMG held up relatively better given it’s not directly in CMRG’s crosshairs
- Sandfire Resources (SFR) -9.6% was the worst of the major miners today — a sharp reversal after a strong run
- Gold miners copped it again as USD strength continued to overwhelm the geopolitical premium — Northern Star (NST) -8.1%, Westgold (WGX) -8.2%, Evolution Mining (EVN) -6.0%, Newmont (NEM) -2.7% and Capricorn Metals (CMM) -6.0%. Gold trading around $US5,125/oz — tracking its first weekly loss in over a month
- Deep Yellow (DYL) -11.8% — the 1H result was a sorry read; net loss widened to $7.78m from $2.47m, revenue fell to $4m from $6.9m and cash is down $31m to $187m. The capital raising speculation earlier in the week didn’t help sentiment either
- Boss Energy (BOE) -6.9% also weighed on the uranium space
- WiseTech Global (WTC) +10.8%, Xero (XRO) +4.5%, TechnologyOne (TNE) +3.9% and NextDC (NXT) +1.9% — tech continued its strong week, with the IT sector the clear standout in an otherwise difficult tape
- Magellan Financial Group (MFG) +9.3% — the Lowy Family taking a 5.1% cornerstone stake in the merged entity sent a powerful signal to the market. Steven Lowy cited longstanding relationships with both the Magellan and Barrenjoey teams and described the merged entity as a sound long-term investment. Hard to argue with that endorsement — MFG is up an extraordinary 36.5% for the week
- Pro Medicus (PME) +9.2% had a strong session, continuing its recovery
- Bapcor (BAP) +14.1% was the day’s standout winner
- SiteMinder (SDR) +13.1% also surged
- DroneShield (DRO) +10.0% — another strong session as the defence theme remains very much alive
- Domino’s Pizza (DMP) +7.2% — a rare good day for the most shorted stock on the ASX
- Woodside (WDS) +1.0% and Santos (STO) +1.9% held firm as oil stabilised around $US84/bbl after Trump flagged “imminent action” to address the energy price spike
- Viva Energy (VEA) +1.5% — UBS reiterated its Buy, highlighting that refining margins at the Geelong facility could jump ~14% above consensus in the March quarter if elevated crude conditions persist
- SkyCity Entertainment (SKC) fell after facing potential class action proceedings over its online casino operations in New Zealand — management denies liability but the overhang is unhelpful
- Qantas (QAN) -1.8% — higher jet fuel costs continue to weigh
- Looking at the MM Portfolios today, Growth was down ~0.5%, Income fell ~0.3%, Emerging Companies bucked the trend gaining ~1.6%, and the Core ETF was off ~0.5%.
- The International Equities Portfolio dipped ~0.1% overnight
- February performance numbers have been updated on the website – a tough month for most portfolios.
- AUD/USD +0.36% to US$0.7033 — holding up better than expected given the risk-off tone.
- Gold around $US5,125/oz — first weekly loss in over a month as USD strength dominates
- Oil retreating slightly to ~$US84/bbl after Trump’s comments, but still up ~16% for the week
- US futures pointing higher — S&P500 +0.18%, Dow +0.20%, Nasdaq +0.3%
