The Thursday Wrap
NAB’s Capital Pump Drives ASX200 To Enjoy Best Performance in Eight weeks.
The ASX exits its 11-week bear market after a surge in banking and financial stocks. This strong momentum drove a positive effect on the market and the biggest one day gains of the ASX since March 30th, closing at 2.9% high.
The banking industry was seen to be up by 7.1%.The domestic market climbed due to a gain in the futures, pointing to more than 1.5pc on Wall Street indices. Likewise, the real estate stocks and the financial sector climbed 4.3% and 4.5 % respectively.
A rally lead by the capital appreciation of the National Australia Bank Limited, on Monday and Tuesday, caused share price to jump by 7.1% to $17.94, a source from AFR mentioned. This upsurge in confidence also led to an increase in share price of ANZ, touching a high of $18.31. A similar rise in the price of Westpac ($17.61) and a modest increase in Commonwealth Bank ($64.30) was also observed.
Furthermore, shareholders of NAB were more profitable on paper by $2.30, bolstering the NAB’s balance sheet to $1.25B after a boost of the institutional commercial placement of $3B.
While the NAB slashed its interim dividend last month, offsetting a provision for the COVID-19 pandemic caused losses and a severe downturn in economy, the bank expects a severe negative impact on the airline, retail, hospitality and real estate industries.
