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ASX edges higher again as commodities gain

The Australian share market has closed modestly higher, stringing together its first three-day winning streak in four weeks as oil and iron ore prices rose on reports that China would end its harsh COVID-19 lockdowns.

The benchmark S&P/ASX200 index finished on Tuesday up 19.5 points, or 0.27 per cent, to 7,112.5, while the broader All Ordinaries gained 24.4 points, or 0.33 per cent, to 7,350.6.

The gains came despite modest losses on Wall Street, where the S&P500 closed down 0.4 per cent.

“Today’s rally is supported by reports that the damaging lockdowns in Shanghai will start to ease later this week, as well as relatively upbeat RBA meeting minutes,” said City Index market analyst Tony Sycamore.

Five of the ASX’s 11 sectors rose, with energy the biggest gainer, rising 2.1 per cent as oil prices climbed following Germany’s announcement it would stop Russian oil imports by year-end, even if the rest of the European Union does not agree on a ban.

Beach Energy rose 6.1 per cent to a two-month high of $1.735, while Santos and Woodside were both up two per cent.

Elsewhere in the sector, Whitehaven Coal climbed 5.9 per cent to an all-time high of $5.20 as its share buyback continues.

The heavyweight mining sector was up 1.1 per cent, as BHP gained 0.6 per cent to $45.56, Rio Tinto climbed 2.2 per cent to $106.67 and Fortescue Metals added 2.3 per cent to $19.39.

Lithium producers had another good day on surging prices for the electric battery component. Pilbara Minerals rose five per cent, Allken gained 5.5 per cent and Core Lithium rose 9.3 per cent as earthworks neared completion at its Finniss lithium project near Darwin.

Brambles gave back two-thirds of Monday’s gains after the global pallet company advised that European private equity giant CVC Capital Partners would not be pursuing a takeover offer after all, “due to the current external market volatility”.

Brambles fell down 7.6 per cent to $10.72.

James Hardie fell 3.5 per cent to a one-year low of $37.50 after the building products company announced sales of US$3.6 billion in the 12 months to March 31, up 24 per cent from a year ago but slightly below market expectations.

The company reaffirmed its FY2023 guidance of $US740 million to $US820 million in net income.

All the big banks were higher, with CBA leading the way with a 1.7 per cent rise to a four-week high of $105.12. Westpac added 0.3 per cent to $24.46; NAB gained 0.5 per cent to $31.48; and ANZ edged 0.1 per cent higher to $25.61.

The healthcare, industrials and property sectors were all down by a little over one per cent, while tech dipped 0.8 per cent after a two-day rally.

Job search company Seek and realestate.com.au owner REA Group both fell by a little over four per cent, while former message board favourite Zip dropped 3.2 per cent to a more than three-year low of 92 cents. Shares in the buy now, pay later company peaked at over $12 in February 2021.

The Australian dollar had hit a one-week high against the greenback, buying 70.11 US cents, from 69.06 US cents at Monday’s close.

ON THE ASX:

The benchmark S&P/ASX200 index finished up 19.5 points, or 0.27 per cent, to close at 7,112.5 on Tuesday.

The All Ordinaries index gained 24.4 points, or 0.33 per cent, to 7,350.6.

CURRENCY SNAPSHOT:

One Australian dollar buys:

69.06 US cents, from 69.06 US cents when the ASX closed on Monday.

90.66 Japanese yen, from 89.22 yen.

67.00 Euro cents, from 66.26 cents.

56.54 British pence, from 56.38 pence.

110.58 NZ cents, from 110.32 NZ cents.

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