ASX Market Update: Gold Stocks Shine as Investors Rotate Amid Sector Divergence

Key Highlights:

• ASX 200 adds modest 0.12% as gold and financials lead
• Healthcare and materials sectors underperform
• Gold hits US$3,276/oz, lifting local miners
• Zip Co surges 18%, Neuren Pharmaceuticals tumbles 5.8%
   

Australia’s sharemarket closed marginally higher on Tuesday, with a sharp divide across sectors revealing a market in the midst of recalibration. The benchmark S&P/ASX 200 rose 9.5 points to 7,771.2, up 0.12%, while the broader All Ordinaries added 0.09% and the Small Ordinaries Index climbed 0.25%.

In a session marked by sector divergence, investors rotated into defensives and gold equities while pulling back from growth-focused healthcare and materials stocks. Sentiment remained cautious, but not panicked—reflected in the ASX VIX index holding at a low 14.3, suggesting expectations of low volatility over the coming month.

Gold Glitters as Global Risks Mount

Gold continued its record-setting run, soaring to US$3,276.20 per ounce, as geopolitical tensions and inflation fears pushed investors toward traditional safe havens. The ASX All Ordinaries Gold Index (XGD) surged 2.07%, making it the best-performing sub-index for the day.

Companies like WIA Gold (+10.81%), Genesis Minerals (+6.17%), and St Barbara (+6.38%) saw outsized gains, buoyed by strong metal prices and a global appetite for inflation hedges. Rare earths players, such as Brazilian Rare Earths (+8.07%) and Lynas Rare Earths (+6.05%), also attracted fresh attention, as supply chain security remains top of mind amid ongoing trade war headlines.

Financials and Real Estate Find Support

The financials sector posted a healthy 0.72% gain, led by Bank of Queensland, which jumped 5.39%, and broader strength across the big four banks. The ASX 200 Banks Index (XBK) rose in tandem, as easing rate hike fears provided a tailwind.

Real estate stocks also found their footing, rising 0.59%, while telecommunications (+0.58%) and utilities (+0.40%) reflected the market’s tilt toward income-generating defensives.

Healthcare and Resources Lose Ground

Not all sectors shared in the gains. Healthcare dragged the broader market, falling 2.72%, with Neuren Pharmaceuticals plunging 5.83% after investors reacted to lackluster updates.

Materials (-0.57%) and energy (-0.08%) were also weak, as Whitehaven Coal slipped over 5% and Mineral Resources declined 4.71%, following bearish broker outlooks tied to tariff concerns and commodity demand uncertainty.

Top Movers: From Zip Co to Select Harvests

Among individual stocks, Zip Co led the gains with a stunning 18.41% rally, as speculative money returned to the embattled BNPL sector. Meanwhile, Iperionx (+11.11%) and Amplitude Energy (+5.71%) also posted robust gains, showcasing interest in niche plays across energy and tech.

On the downside, Select Harvests nosedived 13.86%, the worst performer on the ASX, amid weaker almond export outlooks and input cost pressures.

Global Cues and Commodities

Internationally, markets were mixed. The Dow Jones slipped 0.38%, while Japan’s Nikkei 225 gained 0.84%, helped by industrial optimism.

Commodity prices painted a similar mixed picture—Brent crude was steady at US$64.68, while copper dipped 0.57%. Silver rose marginally, up 0.20% to US$32.36.

Outlook: Calm Markets, Selective Optimism

With the ASX 200 VIX comfortably below 15, investor sentiment remains resilient. The rotation into gold, banks, and real estate suggests a risk-aware but not risk-averse market. The challenge now will be navigating earnings season against the backdrop of persistent inflation, shifting rate expectations, and intensifying global trade disputes.