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First Up

UPDATED 22/08/2025 09:22

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The ASX 200 surged over 100 points on Thursday to close above the 9000 level for the first time, who would have thought back in April? All 11 major sectors closed higher as the bulls got the bit between their teeth, and sellers were very stock-specific. There have been some outliers in the losers’ enclosure, but overall, it’s been a robust start to the August reporting season, and hopes for more interest rate cuts in both the US and Australia have turbocharged the latest leg of the equity rally. The ASX200 has reset its record high seven times so far in August, and we’re only three weeks in.

Investors have brushed aside fears that Trump’s trade war could push the US economy into recession. Australia, often seen as a safe-haven market, feels like its benefited from strong global inflows. Meanwhile, Wall Street’s robust quarterly reporting season is nearing its end, reinforcing optimism for risk assets worldwide, including Australia. Fund managers have been encouraged by the local earnings season so far, despite the heightened volatility as investors erased billions in market value from some of the country’s largest companies, including Commonwealth Bank, CSL and James Hardie.

There remains plenty of scepticism and disbelief in the press, but as we often quote, “don’t fight the tape.” Investors continue to buy the dips in all but the most disappointing stocks post-reporting. A period of consolidation feels overdue, but there are no sell signs in sight at this stage. Seasonally, August and September may be the weakest two months for the ASX200 over the last decade, but with all statistics, there are outliers, and this August, the ASX200 has already gained +3.2%.

From a short-term technical perspective, the bull market remains intact while we stay above 8940.

Overseas markets were mixed overnight as caution prevailed ahead of an important speech by Jerome Powell at the annual economic policy symposium in Jackson Hole, Wyoming. In Europe, the EURTO STOXX 50 slipped 0.2% while the UK FTSE gained +0.2%. In the US, the S&P 500 retreated 0.4% while the small-cap Russell 2000 Index closed +0.2% higher.