Why ASX Is Rising Today Despite Most of The Sectors Are Trading in Red Zone?

Although the S&P/ASX 200 is experiencing gains, 7 out of the 11 sectors are currently trading lower. The Materials and Energy sectors were the top 2 gaining sectors, up by 2.74% and 1.15% in their index values.

In Asian trade on Tuesday, oil prices experienced a slight increase, maintaining their three-month highs. The rise was attributed to indications of tighter supply in the market and expectations of additional stimulus measures from China, which helped offset uncertainties surrounding the upcoming Federal Reserve meeting.

Crude prices had a strong start to the week, surging by more than 2% after top Chinese officials committed to bolstering economic growth in the world's largest oil-importing country.

Market expectations indicated that inventories would have declined by more than 2 million barrels during the week ending July 21, suggesting a steady demand for oil.

However, market attention remained focused on indicators of U.S. fuel consumption, with some concerns arising over sluggish demand in the world's largest oil-consuming nation. Recent extreme weather conditions and high inflation rates have impacted fuel demand in recent weeks, prompting a watchful eye on potential fluctuations in consumption patterns.

Despite the market's uncertainties, the combination of tighter supply conditions, Chinese stimulus efforts, and positive inventory data expectations contributed to the sustained upward trajectory in oil prices, allowing them to maintain their elevated levels.

Major changes due to below mentioned companies: -

Pilbara Minerals Limited (ASX: PLS) gained by 5.3%, company has witnessed a significant 10% surge in spodumene concentrate production, reaching 162.8k tonnes (kt) during Q4 FY23. This milestone marked the highest quarter of production since commissioning, attributed to continuous improvements in processing methods.

Monadelphous Group Limited (ASX: MND) gained by 5.4%, company has announced the acquisition of a significant construction contract with Albemarle, valued at approximately AU$200 million. The contract is related to the expansion project of the Kemerton lithium hydroxide plant, located in the southwest region of Western Australia. This contract award follows Monadelphous' successful delivery of construction packages for trains 1 and 2 in the same project.

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