Why has the ASX LTD (ASX:ASX) popped ~4%?
The ASX Ltd (ASX: ASX) is trading up more than 4% this morning, testing the $61 level following a broker upgrade, extending its strong recovery to ~10%.
The move has coincided with improving equity-market sentiment and a broader re-rating across Australian financials, helped by signs that the RBA tightening cycle may be approaching its peak following softer inflation data and more dovish (less hawkish) commentary from the central bank.
The backdrop is also supportive for ASX’s underlying earnings, with recovering equity-market activity boosting trading volumes while elevated interest rates support income earned on margin and collateral balances.
Macro risks remain, particularly elevated global bond yields and soft investor sentiment, but after a difficult period dominated by regulatory and technology-investment concerns, investors appear increasingly willing to look through these headwinds as market activity improves.
- MM is bullish towards ASX and hold it in “Shawn’s Trading Ideas.”
