Fuelled by hope of a new dawn as a fresh president is elected in the US, the Australian stock market jumped to an eight-month high on Monday, with REA Group and Domain shares both trading at record highs.
REA Group shares jumped to $139.50, leaping 9.1 per cent, as Domain’s rose to $4.62 – a jump of 5.5 per cent.
Both companies are benefitting from record low interest rates; since the RBA announced the new cash rate last Tuesday, November 3, Domain shares have risen 21.3 per cent, with REA jumping 17.1 per cent.
“Listings growth has been weak in recent months – given COVID-19 led mobility restrictions, and particularly in the state of Victoria,” explains UBS analyst Eric Choi.
“However, as evident in today’s result – through a combination of yield and cost levers – REA has still been able to deliver earnings growth.”
JPMorgan analyst Don Carducci said in a note to clients, “the strong listings environment in Sydney in the first quarter with some normalisation in October implies Domain could benefit greatly given its strong exposure to NSW.
“The listings recovery story in Melbourne, with October listings increasing … also bodes well for Domain.”
