The Australian share market rose for a third straight week to a two-month high last week. RBA’s meeting on Tuesday will be the key event to focus on this week and today we look at three stocks: Nab, Telstra and Rio Tinto.
The Australian share market rose for a third straight week to conclude the first quarter of 2022 at a two-month high. Despite the mild fall on Thursday, ASX 200 moved up 6% during the trading session in March and nearly regained all the losses from early this year.
A strong boost from the mining sector and big banks helped the ASX to rebound strongly since mid-March while partially offsetting the concern of upcoming interest rate rises and the geopolitical tension in Ukraine.
Three ASX stocks to watch this week
1. National Australia Bank (NAB)
NAB shares hit a five-year high last Thursday at $32.59. The recently revealed federal budget was viewed as a positive catalyst for banks and as such, share prices for big banks surged last week. In addition to that, NAB recently announced a $2.5 billion buyback: the top Australian bank plans to buy back its shares after the publication of its half-year results, scheduled on 5 May.
The share price of NAB has pulled back from its peak from last Friday, with the current support at $32. Next support can be found from the 20-days moving average. Overall, the mid-term momentum for the bank stays bull-biased, although the over-bought RSI does suggest a near-term retracement is on the cards.
Telstra Corporation (TLS)
Telstra share prices experienced a turbulent week last week as the company made two significant announcements back-to-back. On Wednesday, the retirement of its chief executive officer (CEO) Andrew Penn shocked the market while on Thursday, the telecommunications giant won back the previous loss as the company confirmed to secure a new $187 million contract with the Queensland government.
The share price for Telstra has moved sideways from last week’s trend line on Monday morning. Currently supported by the 20-day moving average, which if broken through, will send the price back to its two-week-low. Imminent resistance will be in line with the 50-day moving average and the previous trendline, at around $3.95.
Rio Tinto Limited (RIO)
Rio Tinto Limited (RIO) share price edged 14.68% higher for the past two weeks as the company’s largest commodity iron ore, rose 11% in March. Since the beginning of 2022, the Rio Tinto share price has gained 20%, powered by soaring commodity prices and strong global demand.
From a technical viewpoint, it looks like the share price has bottomed out from the March low, following the ascending trend line ever since. The next target will be looking at the gap between $123.1 and $125.3, which, if filled, will open the door to the eight-month-high near $128. Current support can be found from the trend line at $120.
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Hebe Chen | Market Analyst, Australia
04 April 2022