A belated spring bounce pushed Australian shares higher on Monday, as investors discounted the chance of a rate hike in the United States this month following disappointing jobs figures.
However, offsetting the broad gains in the banks and miners, aged care stocks took a beating following the government's clarification on what fees aged aged care operators can charge.
The benchmark S&P;/ASX200 Index and the broader All Ordinaries Index each rose 1 per cent to 5429.6 and 5524.4 points respectively.
Analysts at CSLA and Bank of America-Merrill Lynch downgraded their outlooks for Estia Health, Regis Healthcare and Japara Healthcare on Monday morning which saw investors wipe millions of dollars from their market capitalisation throughout the trading session.
Shares in Estia closed 11.8 per cent down to $2.78, Regis was down 16.7 per cent to $3.70 and Japara lost 14.7 per cent to $1.74.
Despite carnage in the aged care sector, Australian shares mostly had a good day following weaker-than-expected US jobs data last Friday. The sour figures put a dampener on speculation the US Federal Reserve might raise interest rates later this month and helped boost sentiment towards commodities.
Shares in BHP rose 2.5 per cent on Monday, following the announcement of Woodside Petroleum's $400 million purchase of BHP's stake in the Scarborough LNG project. Given low energy prices, the project has been on the backburner for owners BHP and ExxonMobile for some time and Woodside's chief executive Peter Coleman has said the company is in no hurry to develop the asset just yet either.
Shares in Woodside Petroleum lifted 1.5 per cent to $28.51 while fellow resources giant Rio Tinto traded 1.5 per cent higher to $48.10.
A modest lift in the iron ore price was enough to give Fortescue Metals a hefty boost with the share price bouncing up 3.7 per cent to $5.02. Investors can't get enough of the iron ore producer following the company's 212 per cent increase in net profit last financial year and a substantial increase in dividend payment.
The big four banks were up for most of the day, although news that ANZ will fork out $28.8 million to more than 390,000 account holders added some late afternoon pressure.
Commonwealth Bank of Australia, National Australia Bank, Westpac and ANZ all closed the session between 1.7 and 2 per cent higher.
Stock Watch
NextDC
Shares in data centre developer NextDC entered a trading halt on Monday following news the company will embark on a capital raising. The Sydney-based business has enjoyed an 80 per cent rise in its share price over the last 12 months, halted now at $4.10. NextDC was recently added to the S&P;/ASX 200 Index with a market capitalisation of $1 billion. The company invested $101 million throughout the 2016 financial year and recently secured sites for its second tier data centres in both Melbourne and Brisbane. NextDC recently delivered a solid set of financial results, reporting a 52 per cent increase in revenue to $92.8 million.
Oil
Oil continued its slide on Monday, falling another 0.2 per cent to $US46.73 a barrel after a 6.2 per cent drop last week. Oil will continue to befuddle investors as major producers meet around the world to discuss the current oversupply and yo-yoing price. Despite last week's overall fall, crude rounded 3 per cent on Friday ahead of Sunday's meeting between Saudi Arabia and Russia to discuss possible price stabilisation. Speculation has increased surrounding a possible output freeze by OPEC and other oil producers.
Company operating profits
Manufacturing and mining companies provided the heavy lifting in the company operating profits data released late Monday morning. The second quarter of 2016 recorded an overall 6.9 per cent rise in profits, outstripping market expectations which were at 2 per cent. Manufacturing profits rose 22.6 per cent and mining profits rose 14.2 per cent, thanks to a rebound in commodity prices. Non-mining sectors rose a healthy 4.6 per cent, providing investors with encouraging signs the overall economy is rebalancing towards non-mining sectors.
Nickel
Nickel rose 1.5 per cent to $US10,004 on Monday following news that shipments of nickel ore from the Philippines may shrink by as much as 30 per cent this year. According to Dante Bravo, president and chief executive officer of Global Ferronickel Holdings, the world's largest nickel supplier, the Philippines' government crackdown on miners may result in further mine suspensions and place pressure on supply. Additionally, several nickel companies have cut output in the first half of 2016 thanks to weak prices and difficult weather conditions.
Asian shares
Shares around the region rose on Monday, following the lead from the United States. Japanese stocks rose to a three-month high, weakening the yen and boosting the country's earnings outlook, particularly among car manufacturers. Weak jobs figures out of the United States have investors speculating Japanese policy makers may increase stimulus should a September rate hike by the US Fed fail to materialise. Hong Kong's equity index climbed the most in nearly two months, led by property stocks.