Index Update: The S&P/ASX 200 closed notably higher on Wednesday, rising 190.00 points or 2.24% to 8,671.80, moving above its 20-day moving average. Despite the positive daily performance, the index remains down 5.73% over the past month.

Over the last five trading sessions, the index has gained 1.61%, while remaining largely unchanged on a year-to-date basis. Market breadth was notably positive, with ten of the 11 sectors finishing in the green alongside the broader index.

The Materials sector emerged as the top performer, advancing 4.86% on the day and extending its gains to 6.13% over the past five days, contributing significantly to the overall market strength.

Macro Update: Global government bonds are on track for their steepest monthly decline in years as markets price in prolonged Middle East conflict-driven inflation risks. The U.S.-Israel war with Iran has disrupted energy supplies, driving oil and gas prices higher and pushing bond yields up globally. Meanwhile, the International Monetary Fund warned that the conflict is creating an asymmetric global shock, tightening financial conditions and weakening recovery prospects across several economies.

Top Market Movers: Thursday’s top gainers on the ASX included Greatland Resources Limited (ASX:GGP), rising to AUD 13.030, up AUD 1.690 or 14.903%. Zip Co Limited (ASX:ZIP) gained AUD 0.165 to AUD 1.715, a 10.645% increase, while Pantoro Gold Limited (ASX:PNR) advanced AUD 0.340 to AUD 3.660, up 10.241%. On the downside, PEXA Group Limited (ASX:PXA) fell AUD 2.240 to AUD 12.970, down 14.728%. Karoon Energy Ltd (ASX:KAR) and Telix Pharmaceuticals Limited (ASX:TLX) declined 3.399% and 3.368%, respectively.

Commodity Update: The U.S. dollar declined on Wednesday as hopes grew that the U.S.-Israel conflict with Iran may prove shorter than initially feared. However, the dollar remained on track for its strongest quarter since the fourth quarter of 2024, supported by lingering safe-haven demand. Gold climbed 0.75% to USD 4,713.50, Brent crude rose 1.56% to USD 105.57, copper gained 0.90% to USD 12,462.90, while silver slipped 0.73% to USD 74.37 during trading.

Our Stance: The S&P/ASX 200 rose 2.24% to 8,671.80 on Wednesday, reclaiming its 20-day moving average, with ten of 11 sectors advancing and Materials leading gains. While the index added 1.61% over five days, it remains down 5.73% for the month and flat year to date. Global macro pressures persist as Middle East tensions lift bond yields and commodity prices. Gains in Greatland Resources Limited and peers supported sentiment, though declines in PEXA Group Limited highlight ongoing volatility. Overall, momentum is improving, but risks remain elevated.

The S&P/ASX 200 advanced by 190.00 points in its latest session, forming a bullish candlestick that signals renewed buying interest and a short-term improvement in sentiment. Despite this positive move, the broader technical outlook remains cautious, as the index continues to trade below its 50-period Simple Moving Average (SMA), which is acting as a significant resistance level and limiting further upside potential. Unless the index manages a sustained breakout above this resistance, near-term momentum is likely to stay constrained. On the downside, immediate support is positioned near 8,570.60. Holding above this level will be crucial to maintain stability and prevent the market from slipping into a deeper corrective phase.