ASX Midday Update: Materials Stocks Jump, Energy Sector Falls

Key Highlights

• Midday Monday, information technology stocks rose close to 1%.
• Xero gained 2% and Life360 soared 7%.
• Energy fell more than 2% as jitters around supply shutdowns subsided.
• Woodside Energy was down 3%, and Santos fell 2%.
• Investors weighed Middle East developments against Australian interest rate expectations.

Midday trading on Monday saw information technology stocks outperforming the overall market, while energy shares struggled as investors reacted to shifting dynamics in world oil markets.

Focus also remained on geopolitical developments in the Middle East and the prospects for a Reserve Bank of Australia interest rate hike when it meets Tuesday.

Nasdaq breaking out

By lunch, the information technology sector was up almost 1%, one of the top-performing sectors on the ASX. Interest in technology shares continued against the uncertain backdrop. Xero rose 2% after being one the top gainers during the session. Life360 (ASX: 360) was up 7% and one of the biggest market movers. Xero and Life360 provided plenty of support for the technology sector, which helped offset weakness seen elsewhere in the market.

Energy stocks fell and Strait of Hormuz fears receded

Oil stocks lost more than 2% and the energy sector also underperformed after US President Donald Trump said that the United States and Iran had reached a peace deal. It alleviated worries about potential global oil supply interruptions and lowered some of the assistance energy stocks got in recent weeks. Investors responded by exiting energy stocks after fears that supply shocks might last longer eased.

The weakest performers were among major energy companies. Woodside Energy fell 3% and Santos was off 2% at midday.

Investors Tracking Interest Rates And Global Developments

Investor focus stayed heavily on events developing around the globe, especially in the Middle East and prospects of their impact on energy markets and global trade.

Meanwhile, the Reserve Bank of Australia (RBA) continues to be in focus as markets prepared for that central bank's next interest rate decision. In the coming days, traders are trying to figure out how global events and domestic monetary policy may impact market performance.

Source: Yahoo Finance Australia (MT Newswires)

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