All Ords surges on rate cut hopes, Comm Bank, Wesfarmers lead gains, TPG Telecom to return $3bn

The local market took a strong lead from Wall Street with every sector finishing higher on Tuesday and ultimately pushing the S&P/ASX 200 Index (ASX: XJO) to a 1.2 per cent gain. The strongest performing sectors were retailers, up 1.8 per cent, and financials, up 1.5 per cent, with Commonwealth Bank of Australia (ASX: CBA) finishing 1.4 per cent higher and Wesfarmers Limited (ASX: WES) nearly 3 per cent. The positive sentiment was driven by rate cut hopes in the US, with a more than 80 per cent chance of September rate cuts now priced into the market. Shares in TPG Telecom Limited (ASX: TPG) reversed early gains to finish slightly lower, with the company to return 3 billion dollars to shareholders following the sale of its fixed line and fibre networks to Vocus Group Limited. Rare earth miners also contributed, with the likes of Iluka Resources Limited (ASX: ILU) gaining more than 8 per cent amid reports that the Australian government could follow the US in applying a floor price to rare earth commodities in an effort to counter China’s control over supply.

Debt collector Credit Corp soars on profit jump, Telix sinks on jump in expenses, Pinnacle reports strong investment flows

US and Australian debt collector Credit Corp Group Limited (ASX: CCP) topped the market, with shares gaining more than 16 per cent after the company reported stronger than expected collections in the US. Combined with a broader growth in consumer lending, profit increased 16 per cent, hitting 94 million dollars for the year. Austal Limited (ASX: AST) managed a 7.9 per cent gain after the company was confirmed as the Federal Government’s preferred shipbuilder once again. Popular thematic play Telix Pharmaceuticals Limited (ASX: TLX) sank by close to 9 per cent after the company flagged a surge in operating expenses that would engulf as much as 36 per cent of revenue in the second half. This was in addition to the anticipated R&D spend. It was another positive quarter for Pinnacle Investment Management Group Limited (ASX: PNI), which takes stakes in fund managers operating in Australia. The group reported a 49 per cent increase in net profit to 134 million dollars, driven by 23 billion dollars in new funds under management.

Markets sink on chipmakers, weaker services, oil slides on Ukraine–Russia truce

The US market fell from near all-time highs overnight, with the NASDAQ Composite Index (NASDAQ: IXIC) leading the losses, falling 0.7 per cent. The S&P 500 Index (NYSE: SPX) fell 0.5 per cent and the Dow Jones Industrial Average (INDEXDJX: DJI) 0.1 per cent, as a group of chipmakers, including Advanced Micro Devices Inc (NASDAQ: AMD), fell by more than 1 per cent. The news came after a stronger than expected sales forecast from AMD, while flagging concerns about access to the Chinese market. News also emerged that Chinese nationals had been detained after allegedly sending millions of dollars’ worth of NVIDIA Corporation (NASDAQ: NVDA) chips across the border despite restrictions. Hopes for an air-truce between Ukraine and Russia pushed oil lower, as it would potentially trigger an opening of more supply in the coming years. Interestingly, data shared by US broker Jefferies Financial Group Inc (NYSE: JEF)suggests that falling Federal Reserve interest rates tend to coincide with an outperformance in smaller companies over their large-cap counterparts. Amazon.com Inc (NASDAQ: AMZN) is said to be considering offering access to OpenAI applications via its platform.