The S&P/ASX 200 (ASX: XJO) experienced its strongest day in four months, adding 1.5% on Tuesday, all but erasing Monday’s losses.
Every sector but healthcare finished higher, with real estate and energy the biggest beneficiaries, adding 2.0% and 2.2%, respectively.
The positive sentiment came from Fed Chair Jerome Powell’s written testimony confirming his confidence that inflation would fall below 2% ocne ‘transitory supply effects abate’.
Property gains
Property was among the biggest beneficiaries with Charter Hall Group (ASX: CHC) up 3.4% and Vicinity Centres (ASX: VCX) up 2.9%, even as tax changes impact valuations.
On Monday, Vicinity reported a 1.2% fall in its property valuations, primarily in CBDs, in order to price-in the recent Victorian Government land tax and stamp duty changes as well as continued rent deferrals.
On the positive side, management announced a 6.6 cent distribution, nearing the 8 cents paid in 2020 as operations continue to return to normal.
Soul Patts mergers with Milton
Another listed investment company is set to disappear from the ASX boards as the inefficiencies of the structure remain in question.
Washington H. Soul Pattinson and Co Ltd (ASX: SOL) is set to merge with Milton Corporation Limited (ASX: MLT) at a price of $6 per share. Milton shares jumped 16% to $5.80 on the news.
The deal will create a $10 billion investment company, with Milton shareholders receiving an 8c final dividend, 37c special dividend and a 7 cent dividend from Soul Patts.
The combined entity is expected to use its larger balance sheet and the greater flexibility that comes without the LIC mandate structure to finalise a number of deals to purchase alternative assets, says management.
Lithium miners rally, Independence Group gets approval
ASX lithium miners IGO Ltd (ASX: IGO) and Pilbara Minerals Ltd (ASX: PLS) jumped 7.4% and 6.2%, respectively, after the former received approval to finalise the joint venture with its Chinese partner.
Nuix hits record low
Shares in Nuix Ltd (ASX: NXL) hit a new record low after it was announced that the Australian Federal Police would review the payout of options to a previous shareholder for ‘potential breaches of the Corps Act’.
ASX 200 today
Looking ahead, the ASX 200 is set to edge lower at the open on Wednesday despite a positive lead from US markets overnight. To get up to speed, check out Rask Media’s daily US stock market report.