The weakest monthly inflation print in close to two years offered the best possible backdrop for the local market on Monday, with the S&P/ASX 200 (ASX: XJO) gaining 1.5%.
Technology was the standout, up 4.6%, with only a small handful of companies falling on a buoyant day for the market, led by AGL Energy Limited (ASX: AGL) which fell 1.7%.
AGL demerger scrapped
The company dragged the utilities sector lower after effectively capitulating to the pressure from billionaire Mike Cannon-Brookes. Management announced they would withdraw their proposal to split the company in two, with both Chairman Peter Botten and CEO Graeme Hunt resigning to allow the company to pursue a fresh start.
With Cannon-Brookes amassing 11% of AGL’s shares on issue, it was becoming clear the demerger was unlikely to proceed but the company is now left in limbo and potentially ripe for a takeover bid; the result dragged the utilities sector, being the only detractor on the market.
Elsewhere, shares in Australia and New Zealand Banking Group Ltd (ASX: ANZ) overcame news of another court proceeding being initiated by ASIC, this time in relation to the balances and fees charged on credit card accounts.
Biden spurs infant formula sector
Australian infant formula makers were once again in the spotlight, this time for good reasons, after President Biden announced that the government would be purchasing 27.5 million bottles of formula for US families amid a domestic and global shortage of the product.
The shortage comes after Abbott Laboratories recalled its products and sent shares of Bubs Australia Ltd (ASX: BUB) up 40.2% and A2 Milk Company Ltd (ASX: A2M) up 10% with the former negotiating a contract directly with the government.
Liontown extends
The iron ore price continues to rally as Chinese lockdowns continue to ease, whilst lithium miner Liontown Resources Limited (ASX: LTR) gained another 5.3%.
The Liontown share price rallied after Tesla (NASDAQ: TSLA) agreed to extend a negotiation period in which both companies are seeking to come to terms on supply contracts totalling 150,000 tonnes.
Big day for ASX tech
Technology was clearly back in favour, with Zip Co Ltd (ASX: Z1P) adding 14%, Block Inc CDI (ASX: SQ2) up 10.9% and Tyro Payments Ltd (ASX: TYR) gaining 10.2%.
US stock markets were closed overnight for memorial day, but futures spike on the end to China lockdowns. Despite this, the ASX 200 is tipped to edge lower when the market opens this morning.