Aust shares little changed, yields rise

·4-min read

Shares have closed slightly higher on the Australian market, which an analyst declared an impressive result as bond yields crept towards recent highs.

The S&P/ASX200 benchmark index closed higher by 6.2 points, or 0.09 per cent, to 6773 on Monday.

The All Ordinaries closed higher by 4.5 points, or 0.06 per cent, at 7019.1.

The top sector was health, up 1.08 per cent, and property was next best, up 0.99 per cent.

The materials sector proved a drag, down 0.61 per cent. Iron ore prices slipped on concerns that Chinese steelmakers may reduce output.

Information technology dropped 1.89 per cent after the US Nasdaq dropped on Friday.

While the ASX moves were marginal, ThinkMarkets analyst Carl Capolingua was upbeat.

He noted Australian and US 10-year bond yields had moved higher.

The Australian was at 1.7 per cent, while the US was at 1.6 per cent.

"The last few weeks have been all about higher rates spooking stocks," Mr Capolingua said.

"So to see our market fairly firm, even as yields edged higher, you start to think that investors have made peace with the idea that rates may continue to adjust higher in the short term."

Reserve Bank governor Philip Lowe was not selling that rates message at a speech in Melbourne.

He said it is important that business investment grows if Australia is to enjoy a strong recovery from the COVID-19 pandemic.

"There is still a long way to go to get back to the level of investment before the pandemic, which itself was low by historical standards," he said.

There was good news for exporters as China said industrial output beat expectations for January-February.

Output rose 35.1 per cent from a year earlier, national data showed.

US markets provided a mostly positive lead from Friday, when the Dow Jones hit a fifth consecutive record high and the S&P 500 gained.

On the ASX, there were notable acquisitions.

Gold miner Evolution will buy Canadian miner Battle North for about $C343 million ($A354 million).

Battle North has a gold project in Ontario, while Evolution has a mine in the same district.

Evolution wants to produce more than 300,000 ounces of gold per year from the area.

Shares were up 2.53 per cent to $4.05.

A consortium including AGL and Australian government groups will buy windfarm operator Tilt Renewables.

Powering Australian Renewables, owned by AGL and the Queensland government's Queensland Investment Corporation, will acquire Tilt's Australian business.

The federal government's Future Fund also has a stake in Powering Australian Renewables.

Consortium member, Mercury NZ, will buy the New Zealand business.

The deal values Tilt at about $NZ2.9 billion ($A2.7 billion).

Tilt shares climbed 15.03 per cent to $7.04, while Mercury NZ shares rose 4.55 per cent to $5.75.

Buy now, pay later provider Openpay is trialling its service with hospital operator St John of God Health Care, which is allowing elective surgery patients to pay through instalments using Openpay.

Shares were lower by 1.52 per cent to $2.60.

Iron ore miners dipped. BHP fell 0.19 per cent to $47.88, Fortescue lost 4.14 per cent to $20.38 and Rio Tinto shed 2.16 per cent to $114.13.

In banking, ANZ was best of the big four and rose 0.57 per cent to $28.40.

On Tuesday, the Reserve Bank will publish the minutes of its March 2 board meeting.

The Australian Bureau of Statistics will issue weekly payroll jobs figures and capital city house prices for the December quarter.

The Australian dollar was buying 77.22 US cents at 1716 AEDT, lower from 77.83 US cents at Friday's close.

ON THE ASX

* The S&P/ASX200 benchmark index closed higher by 6.2 points, or 0.09 per cent, to 6773 on Monday.

* The All Ordinaries closed higher by 4.5 points, or 0.06 per cent, at 7019.1.

* At 1716 AEDT, the SPI200 futures index was lower by seven points, or 0.1 per cent, and trading at 6771 points.

CURRENCY SNAPSHOT

One Australian dollar buys:

* 77.22 US cents, from 77.83 cents on Friday

* 84.43 Japanese yen, from 84.50 yen

* 64.76 Euro cents, from 64.95 cents

* 55.57 British pence, from 55.60 pence

* 107.52 NZ cents, from 107.79 cents.