The ASX 200 in Australia recorded another new high on Wednesday, further gaining 77.2 points or 0.90% to close at 8,639.0. This constituted the tenth record peak for the index in 2025 amid investors shrugging off a global momentum coming from Wall Street and solid gains in domestic sectors.
The local rally comes on the heels of good U.S. earnings numbers, stronger-than-expected economic data, and a global pivot towards growth and battery-metals industries.
US indices inched above record territory last night; the S&P 500 was up 0.54% at 6,297, and the Nasdaq could gain 0.75% to reach 20,886. On early Thursday, ASX SPI 200 futures jumped 32 points (+0.37%).
ASX 200 surges to a record high
Can lithium and graphite stocks sustain their momentum?
Battery metals stocks were leading the performers on the ASX. Investors picked shares in lithium and graphite companies as demand for EV supply chains built up.
Companies like Syrah Resources and Sovereign Metals experienced heightened activity. This happened after Queensland fast-tracked a $1.23 billion graphite mine to stop Chinese supply from dominating.
This is an important energy security shift that provides investors with a strong growth theme in the long run. The greater interests of global EV adoption, green energy goals, and battery storage capacity requirements fuel this trend.
While lithium stays volatile in price, mining companies listed on ASX have been outperforming in July. These returns come after a long correction since 2024.
Lithium and graphite stocks lead ASX gains in early trade
Are US buy-backs driving global equities?
American companies are going to finish the year conducting over US$1 trillion worth of stock repurchases. That has become a tailwind for equity prices over the S&P 500 and Nasdaq.
US majors like PepsiCo (+7.4), United Airlines (+3.1), and TSMC (+3.4) have gotten strong earnings under their belt, putting global investors at further ease.
In July, both the S&P 500 and Nasdaq could turn out to be the strongest performing month since January. The earnings season and buy-back tailwind look to keep providing support to the upside in the near term.
But Nasdaq now trades about 6.8% above its 50-day moving average, a level that really has investors on some edge.
S&P 500 hit all-time highs overnight
Will global trade optimism support the ASX further?
Bulls around China economic and global trade sentiment should provide an additional lift. Chinese GDP surprised to the upside in Q2, and stimulus signalled by the government.
This saw the commodity-linked sectors like materials and energy on ASX shine.
The Aussie dollar was hovering around US64.9c, and Bitcoin surpassed US$123,000, suggesting a general risk-on sentiment.
The investors got encouraged from signs suggesting that tariff tension may loosen between big economies, allowing international trade flows to continue.
US and Australian indices show broad strength
All the leading world indices are in a rally mood. The ASX 200, S&P 500, and Nasdaq all have their twentieth-digit percentage gains for 2025.
Year-to-date returns:
- ASX 200: +10.2%
- S&P 500: +6.7%
- Nasdaq: +7.5%
Some of these Australian sectors responsible for the record ASX close were financials (+0.9%), technology (+0.9%), and materials (+0.6%). Only one sector, healthcare, posted a marginal decline.
It shows strength all around across industries and Canadians, as well as investors, who are looking forward to risk assets.
Sector wise ASX Share Trend
Investor Outlook: Bullish but selective
While positive sentiment persists among investors, certain analysts are beginning to raise valuation concerns.
The S&P 500 Woodnow trades with the highest forward P/E ratio since the dotcom days. Earnings growth has been supporting the rally, but stretched valuations indicate the return of volatility.
Lithium continues to be a key focus area in Australia. Assuming that EV/battery demand holds into Q4, miners such as Pilbara Minerals and Allkem can excel.
With the RBA cutting rates and global growth stabilizing, ASX could be sitting in a sweet spot. There remains, however, a chance for profit-taking in the overbought names.
ASX well-positioned for second half of 2025
The ASX 200 has all bases covered for a terrific H2 of 2025-a period that would see a backdrop of US earnings strength, dovish central bank guidance, and good wind power in its sails.
Technical set-up-wise, it is in the positive stage, with 10 of 11 sectors closing up while volume is widening.
Investor Tips
- Keep an eye on lithium stocks; global EV demand is rebounding.
- Remain diversified into sectors such as technology, banking, and energy.
- Take profits in overheating Nasdaq names if momentum stalls.
- Keep checking signals from the RBA come August and trends in commodity demand.
Also Read: ASX 200 Update: Market Rallies Near Record as Lithium Stocks Drop
ASX 200 Momentum Gains Confidence, but Caution Remains Vital
The sentiment turning point reached here can be traced in this ASX market update. Record highs across indices such as ASX 200, S&P 500, and Nasdaq indicate a fine global coordination. The driving narratives are lithium stocks and US buy-backs.
With risks emanating from valuations and policy surprises, the near-term outlook remains constructive, especially for diversified funds and those exposed in battery metals and tech.
