ASX Inches Toward Record as Rare Earths Shine, Market Awaits Global Signals

Key Highlights:

• ASX 200 edges up 0.2% to 8,556.2, nearing its February record
• Lynas soars 7% on rare earths supply fears amid China export concerns
• Energy dips as oil prices slide; banks remain broadly flat
• Volatility expected to stay low over next 30 days

The Australian sharemarket inched higher Thursday morning, brushing up against record territory as resource stocks, particularly rare earths, led the charge. The ASX 200 rose 17.2 points, or 0.2%, to 8,556.2, just clearing its previous all-time closing high of 8,555.8 set in February.

This came despite a muted session on Wall Street, where the S&P 500 ended flat and the Dow dipped 91 points following lackluster economic reports. Still, the local market’s resilience suggests strong investor confidence in the domestic outlook—at least for now.

Lynas Lifts Materials

Resource optimism was anchored by Lynas Rare Earths, which leapt 7% in early trade. Automakers in the US and Europe expressed renewed concerns over China’s tightening grip on rare earth exports, seen as critical inputs for electric vehicles, wind turbines, and defense technologies.

This geopolitical tension translated into strong tailwinds for Lynas, the largest non-China rare earths producer, and helped lift the broader Materials sector by 0.35%. Fortescue added 0.6%, Rio Tinto climbed 0.4%, while BHP slipped marginally by 0.1%.

Banks Flat, Energy Slips

The Big Four banks were largely subdued. Commonwealth Bank and Westpac ticked up 0.1%, ANZ dipped 0.1%, and National Australia Bank lost 0.2%, reflecting investor caution ahead of U.S. jobs data due later in the week.

Meanwhile, a fall in oil prices overnight saw Santos and Woodside Energy drop 0.3% each, dragging on the Energy sector, which remained flat overall.

ASX Sector Pulse

Out of 11 sectors, six were in the red, but gains in Information Technology (+0.63%), Staples (+0.37%), Materials, and Real Estate (+0.34%) kept the index afloat.

The All Technology Index also showed strength, up 0.16%, reflecting broader interest in growth stocks amid easing rate hike fears.

Gainers & Laggards

Among standout performers, Iperionx surged 20.6%, followed by 29Metals (+14.6%), and Orthocell (+6.9%). Other rare earth and energy-related names like Meteoric Resources (+6.5%) and Clarity Pharmaceuticals (+4.6%) also posted strong gains.

On the downside, Resimac Group plunged 12.3% post-dividend, while Tyro Payments lost 11.5%, reflecting ongoing volatility in financial tech names.

Currency & Commodities

The Australian dollar continued to firm, fetching 65.00 US cents by mid-morning. Commodity markets were mixed: Brent crude dropped 1.1%, gold rose 0.6% to US$3,397.40, and copper gained 1.4% amid tight supply expectations.

Outlook: Calm Waters Ahead?

Despite external pressures, the ASX Volatility Index (VIX) remains low, pointing to subdued market swings over the next month. That suggests investors are largely pricing in a stable rate environment and solid corporate earnings season—though U.S. macro data later this week could still sway sentiment.

With geopolitical currents and commodity moves providing the undercurrent, the Australian market appears poised but cautious—edging toward new highs, one data point at a time.