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ASX 200 Weekly Wrap: ASX 200 hits a 6! Thank iron ore

ASX shares represented by gold letters spelling ASX sitting atop a line graph
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The S&P/ASX 200 Index (ASX: XJO) has just hit a 6! Cricket metaphors aside, the ASX 200 has just notched up its sixth straight week of gains, leaving it just below the level at which it started the year. It’s worth saying that even though last week kept this streak alive, it was only by a wicket (sorry!).

After a strong start to the week, losses later on pulled the ASX back to Earth, and resulted in the index notching up a week-to-week gain of just 0.1%. Even so, it doesn’t matter if you win by an inch or a mile, to quote a great racing film, and at the same time this week, we will see if the streak runs (I’ll stop now) to 7.

The iron price pays

We can probably thank the resources sector for the ASX’s week in the green, specifically those companies that mine iron. Iron ore had another incredible week, topping US$150 per tonne (and reaching as high as US$156) for the first time since 2013. This saw the share prices of iron ore miners go ballistic. Fortescue Metals Group Limited (ASX: FMG) was the headline act in this show, with the Fortescue share price reaching a new, all-time high of $23.27 on Friday. That share price means Fortescue is now up more than 112% year to date, and up an incredible 1,226% over the past 5 years.

It also means that Fortescue’s market position has never been stronger. With a current market capitalisation of more than $70 billion, Fortescue is now larger than Australia and New Zealand Banking Group Ltd (ASX: ANZ). That would have been an almost inconceivable proposition for most ASX investors to imagine even just a few months ago.

It wasn’t just Fortescue basking in the reflection of the surging iron ore price though. The ‘Big Australian’ BHP Group Ltd (ASX: BHP) is also at a 9-year high, with its share price having hit a peak of $43.30 on Friday. It’s a similar story with Rio Tinto Limited (ASX: RIO). The Rio share price hit a post-GFC high of $117.12 on Friday.

Oil and vaccines

But it’s not just iron ore companies feeling the love from commodity investors. Crude oil is also trading at (a less impressive) post-March high after hitting US$50 a barrel last week. As a result, we saw ASX oil drillers like Woodside Petroleum Limited (ASX: WPL) continue their recent run of performance as well.

One ASX 200 blue chip share not feeling the love last week though was CSL Limited (ASX: CSL). The CSL share price lost almost 5% of its value between Wednesday’s open and Friday’s close. The catalyst? It unfortunately became clear the coronavirus vaccine the company had been working on in conjunction with the University of Queensland would not be progressing to Phase 2 or 3 clinical trials. CSL shares closed at $291.53 on Friday.

How did the markets end the week?

It was a haphazard week on the ASX 200 last week. The Index started off at 6,634.3 points and finished up at 6,642.6 points to eke out a week-to-week gain of 0.1% as we discussed earlier.

Monday kicked things off with a 0.6% gain, which was backed up on Tuesday with another 0.2% rise. Wednesday added another 0.6%, but Thursday and Friday saw sentiment turn, delivering 0.7% and 0.6% losses respectively.

Meanwhile, the All Ordinaries Index (ASX: XAO) also managed to squeak out a gain for the week, rising from 6,874.8 points to 6,886.4 points, a week-to-week gain of 0.3%.

Which ASX 200 shares were the biggest winners and losers?

Time now for our Foolish gossip page. So fetch the tea while we start with the worst-performing ASX 200 shares from last week:

Worst ASX 200 losers % loss for the week
Appen Ltd (ASX: APX) (14.5%)
IDP Education Ltd (ASX: IEL) (8.9%)
Webjet Limited (ASX: WEB) (8.7%)
 Pendal Group Ltd (ASX: PDL) (8.2%)

WAAAX growth share Appen led the losses last week and receives the wooden spoon. Investors were swiping left on Appen after the company downgraded its guidance, citing lockdowns over in the United States and a stronger Aussie dollar.

Higher education company IDP was also in the firing line last week, with a near 9% drop. This could be being driven by concerns over the ongoing diplomatic spat between Australia and China that is spilling into trade. Chinese international students are a significant customer base of IDP Education.

Meanwhile, Webjet and Pendal both fell for no obvious reason. However, both companies enjoyed strong gains over November, which might indicate some investors were taking profits off the table.

With the losers out of the way, let’s now look at some of last week’s ASX 200 winners:

Best ASX 200 gainers % gain for the week
IGO Ltd (ASX: IGO) 14.77%
Link Administration Holdings Ltd (ASX: LNK)
13.57%
Fortescue Metals Group Limited (ASX: FMG) 13.52%
Viva Energy Group Ltd (ASX: VEA) 11.81%

Last week’s winning share was nickel miner IGO. IGO has recently completed a share purchase plan, which is intended to fund a new 49% stake in Tianqi Lithium Energy Australia. Investors have seemingly endorsed this with enthusiasm.

Meanwhile, Link Administration has been the subject of a second takeover offer. This time it’s from SS&C Technology, which values Link at $5.85 a share. No wonder investors are chasing the Link share price towards this mark.

We’ve already discussed Fortescue’s remarkable week, while Viva Energy was in investors’ sights after a positive update over its Geelong Energy hub.

What does this week look like for the ASX 200?

There’s a couple of things to look out for this week on the ASX 200. Firstly is the Index’s quarterly rebalance. This is set to take place on 21 December, and will result in Kogan.com Ltd (ASX: KGN) and Reece Ltd (ASX: REH) joining the club. Even though the rebalance date is not this week, the index funds that track the ASX 200 are very large, and have to make this pivot slowly (kind of like steering a large ship). As such, we could see some funny things happening with the affected shares’ pricing this week.

Additionally, ASX banks ANZ and National Australia Bank Ltd (ASX: NAB) are both holding their annual general meetings this week, on Wednesday and Friday respectively. It will be interesting to see what comes out of these, especially if it involves dividend news.

Before we go, here is a look at the major ASX 200 blue chip shares as we start on another week (make Fortescue feel welcome):

ASX 200 company Trailing P/E ratio Last share price 52-week high 52-week low
CSL Limited (ASX: CSL) 46.82 $291.53 $342.75 $242.67
Commonwealth Bank of Australia (ASX: CBA) 20.15 $82.39 $91.05 $53.44
Westpac Banking Corp (ASX: WBC) 31.31 19.95 $25.96 $13.47
National Australia Bank Ltd (ASX: NAB) 21.50 $23.33 $27.49 $13.20
Australia and New Zealand Banking Group Ltd (ASX: ANZ) 18.95 $22.94 $27.29 $14.10
Fortescue Metals Group Limited (ASX: FMG) 11.10 $22.95 $23.37 $8.20
Woolworths Group Ltd (ASX: WOW) 42.26 $38.91 $43.96 $32.12
Wesfarmers Ltd (ASX: WES) 34.61 $49.59 $50.67 $29.75
BHP Group Ltd (ASX: BHP) 20.22 $42.82 $43.30 $24.05
Rio Tinto Limited (ASX: RIO) 19.51 $116 $117.12 $72.77
Coles Group Ltd (ASX: COL) 24.52 $17.98 $19.26 $14.01
Telstra Corporation Ltd (ASX: TLS) 19.81 $3.03 $3.94 $2.66
Transurban Group (ASX: TCL) $13.64 $16.44 $9.10
Sydney Airport Holdings Pty Ltd (ASX: SYD) 100.2 $6.59 $8.98 $4.26
Newcrest Mining Ltd (ASX: NCM) 24.12 $27.05 $38.15 $20.70
Woodside Petroleum Limited (ASX: WPL) $23.31 $36.28 $14.93
Macquarie Group Ltd (ASX: MQG) 20.86 $138.08 $152.35 $70.45

And finally, here is the lay of the land for some leading market indicators:

  • S&P/ASX 200 Index (XJO) at 6,642.6 points.
  • All Ordinaries Index (XAO) at 6,886.4 points.
  • Dow Jones Industrial Average Index (DJX: .DJI) at 30,046.37 points after rising 0.16% on Friday night (our time).
  • Gold (Spot) swapping hands for US$1,839.43 per troy ounce.
  • Iron ore asking US$155.18 per tonne.
  • Crude oil (Brent) trading at US$49.97 per barrel.
  • Australian dollar buying 75.33 US cents.
  • 10-year Australian Government bonds yielding 0.99% per annum.

That’s all folks, see you next week!

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Sebastian Bowen owns shares of National Australia Bank Limited, Newcrest Mining Limited, and Telstra Limited. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of Appen Ltd, CSL Ltd., Idp Education Pty Ltd, and Link Administration Holdings Ltd. The Motley Fool Australia owns shares of and has recommended Macquarie Group Limited, Telstra Limited, and Webjet Ltd. The Motley Fool Australia owns shares of COLESGROUP DEF SET, Transurban Group, Wesfarmers Limited, and Woolworths Limited. The Motley Fool Australia has recommended Link Administration Holdings Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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