‘Tis the season for market euphoria as Australian share market breaks another record

The Australian share market has reset its record high, bounding towards 8500 points on the back of a bumper year for shareholders in its biggest company.

The benchmark index, the S&P-ASX200, hit a new peak of 8642.1 on Monday before finishing at a record closing high of 8417.6 and is on track to record one of its best annual returns of the past decade after allowing for 2021’s super-sized post-pandemic recovery.

Despite concerns about Australia’s mixed economic performance, the market has risen 7.7 per cent since the end of September.

Investor optimism about the likely wide impact of the business-friendly policies of US president-elect Donald Trump has provided encouragement after driving US markets higher.

“Buoyed confidence amidst a Trump administration focused on growth is seeing a risk-on period with investors taking long positions in growth assets from crypto to US shares,” CMC Invest’s Fraser Allen said.

“With an expected strong close to earnings season and the typical seasonal tailwind the Santa Rally could be one of the best the market has seen.”

However, the S&P-ASX200’s 10.9 per cent rise has been substantially driven by a handful of local stocks led by Commonwealth Bank of Australia, its biggest stock by value.

CBA, a major contributor to superannuation accounts, is up 43 per cent this year, including 11.8 per cent this quarter.

According to Bloomberg data, the bank alone accounts for nearly 300 of the 790 points added to the S&P-ASX200 in 2024. Its banking rivals, Westpac, National Australia Bank and ANZ, account for another 340.

Of the ASX 200 members, 85 are still in the red for the year. They include heavyweights BHP (down 20.3 per cent), Rio Tinto (14 per cent), Woodside Energy (18.3 per cent) and Woolworths (19.6 per cent).

Among the surprise packets, Qantas has added 65 per cent, pokies manufacturer Aristorcrat Leisure is up 64 per cent and JB Hi-Fi has gained 70 per cent.

However, the best performers are topped by the recently-maligned buy-now, pay later group Zip Co, which has put all other companies in the shade by surging 427 per cent in value since January, most of it accumulated in the second half of the year.

The company has been buoyed by its increasing use in the US, where it was used by four million shoppers in the September quarter and transactions surged by 43 per cent on a year earlier. Transaction value was nearly 23 per cent better at $2.8 billion.

The top-10 biggest gainers for the year were fleshed out by health care, biotech and tech stocks, with family tracking app Life360 (up nearly 188 per cent), Sigma Healthcare (161 per cent), Pro Medicus (137 per cent) and Pinnacle Investment Management (136.8 per cent) rounding out the top five.

At the other end, however, Sydney casino company group Star Entertainment is set to finish as the market’s worst stock this year, down 59 per cent so far. Domino’s Pizza has also had a fall from grace, losing nearly 49 per cent, while former mining darlings Liontown Resource and Mineral Resources have given up 51.8 per cent and 52.2 per cent respectively.