ASX rises as Starpharma, Reece surge; CBA falls

The Australian sharemarket was trading higher on Monday, led by a rally in mining stocks amid a broad uptick in commodity prices.

The S&P/ASX 200 index was up 0.5 per cent, or 42 points, to 8815.5 points in early afternoon, extending Friday’s rally. Wall Street’s gains buoyed sentiment amid the prospect for more rate cuts from the US Federal Reserve.

Of the ASX’s 11 sectors, seven flashed green. Energy and real estate were a drag on the market.

Resources stocks were propelled by an uptick in iron ore, copper, lithium, and gold prices. Mining giant Rio Tinto advanced 1.9 per cent, and Fortescue 3.2 per cent.

BHP rose a more modest 0.8 per cent with gains capped by a report that China’s state-run iron ore trader has told steel mills to temporarily stop using a popular product from BHP after contract talks faltered.

Gold stocks extended gains as the precious metal pulled closer to a fresh record high. Perseus Mining leapt more than 8 per cent, while Regis Resources and Northern Star jumped 7.8 per cent each. Evolution Mining climbed 5.7 per cent and gold miner Newmont rose 4.7 per cent after pocketing $666 million from its Orla divestment.

Elsewhere, the big banks were subdued. Commonwealth Bank slipped 0.2 per cent, ANZ edged up 0.2 per cent, National Australia Bank was flat and Westpac gained 0.3 per cent.

In the energy sector, Whitehaven Coal shaved off nearly 3 per cent, while Woodside fell 1 per cent. Viva Energy tumbled nearly 8 per cent after the shock resignation of Jevan Bouzo, who was the chief executive of the convenience and mobility business.

Stocks on the move

In corporate news, biotech Starpharma soared 65 per cent after inking a licensing agreement with Genentech, a member of the Roche Group, to develop new cancer therapies.

Plumbing supplies group Reece jumped 13.7 per cent on plans to buy back $250 million of shares.

Building materials company James Hardie Industries lifted 1.5 per cent even as Citi cut its price target from $35 to $33 and lowered its earnings per share estimate by 19 per cent over the next three years.