Index Update: The S&P/ASX 200 closed sharply higher on Monday, rising 161.30 points, or 1.85%, to 8,870.10 after setting a new 20-day low earlier in the session. Over the past five days, the index has gained 1.04% and now sits 2.69% below its 52-week high. All 11 sectors finished in positive territory alongside the benchmark. Information Technology led sector gains, climbing +3.31% and rebounding from its recent decline, though the sector remains -7.96% over the past five days.

Other sectors also posted advances. A-REIT rose +3.23%, Materials gained +2.99%, Industrials added +1.81%, and Energy increased +1.79%. Consumer Discretionary advanced +1.70%, while Utilities and Financials rose +1.24% and +1.23%, respectively. Consumer Staples edged up +0.99%, Telecommunications Services gained +0.88%, and Health Care closed +0.59% higher.

Macro Update: Household spending slipped 0.4% in December 2025, according to seasonally adjusted data from the Australian Bureau of Statistics (ABS), following increases of 1.0% in November and 1.4% in October, with annual spending still 5.0% higher than December 2024. The ABS said elevated spending during major sales and cultural events in October and November likely pulled purchases forward, contributing to the December decline across both discretionary categories such as electronics, clothing and furniture, and essential items including healthcare. Health spending fell after several months of increases, partly linked to higher bulk-billing rates reducing out-of-pocket costs, while the steepest declines were recorded in Clothing and footwear (-2.4%), Furnishings and household equipment (-1.7%), and Health (-1.3%). Higher spending on new vehicles helped offset some of the overall decline.

Top Market Movers: Top gainers of Monday on the ASX included Web Travel Group Limited (ASX:WEB), which rose to AUD 3.510, up AUD 0.550 (18.581%), followed by Resolute Mining Limited (ASX:RSG) at AUD 1.425, up AUD 0.165 (13.095%), and Ora Banda Mining Ltd (ASX:OBM) at AUD 1.195, higher by AUD 0.130 (12.206%). On the downside, Challenger Limited (ASX:CGF) slipped to AUD 8.600, down AUD 0.320 (3.588%), GQG Partners Inc. (ASX:GQG) eased to AUD 1.665, down AUD 0.030 (1.770%), and News Corporation (ASX:NWS) fell to AUD 37.700, lower by AUD 0.620 (1.618%).

Commodity Update: The Japanese yen strengthened in Asian trading on Monday after a decisive election victory lifted expectations of fiscal stimulus, snapping a six-day losing streak. Gold rose 1.19% to USD 5,038.90, silver jumped 5.09% to USD 80.92, and copper edged 0.01% higher to USD 13,052.00. Brent crude slipped 0.70% to USD 67.57 amid easing Middle East tensions, a resilient dollar, and caution ahead of key U.S. and China data.

Our Stance: Monday’s sharp rebound in the S&P/ASX 200, with all 11 sectors finishing higher, points to broad-based buying after a recent pullback, led by Information Technology and supported by A-REITs and Materials. However, the macro backdrop is mixed: December’s 0.4% dip in household spending suggests demand was pulled forward by earlier sales, with softness across discretionary and health categories partly offset by vehicle purchases. Stock-specific moves were decisive, with WEB, RSG and OBM leading gains, while CGF, GQG and NWS lagged. Commodities were mixed, with precious metals higher and Brent softer, keeping near-term sentiment data dependent.

In the latest session, the S&P/ASX 200 Index advanced 161.30 points to close at 8,870.10, forming a bullish candlestick supported by strong trading volumes, which reflects sustained investor confidence and positive market participation. From a technical standpoint, the index continues to trade comfortably above its 50-period Simple Moving Average (SMA) on the daily chart, with this level acting as a key dynamic support and reinforcing the prevailing short-term uptrend. The support zone near 8,800 remains critical for preserving the current bullish structure; a successful hold above this level is likely to encourage consolidation and potentially drive further upside momentum. Any failure to hold this support could invite near-term volatility. On the weekly timeframe, the index remains well above its 50-period SMA, highlighting a strong medium- to long-term technical setup and signaling that the broader trend remains firmly positive despite short-term fluctuations.