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Rebounding miners help lift ASX 0.8pct

The Australian share market has closed higher, buoyed by gains in the materials sector as the major miners look to benefit from falling energy prices.

The benchmark S&P/ASX200 index finished at the highs of the day on Thursday, up 53.5 points, or 0.81 per cent, to 6648.0. The broader All Ordinaries rose 52.6 points, or 0.78 per cent, to 6836.9.

“Pretty good day today,” Saxo Capital Markets Australian market analyst Jessica Amir told AAP.

“The market’s pretty upbeat, and I think the reason for that is two things: bond yields in Australia are at one-month lows, and secondly, industrial metal prices are rallying up again.

“That’s because the oil price is now seeing two very large down days, and one of the biggest costs for resources companies is energy.”

BHP rose 3.1 per cent to $38.94, Fortescue Metals gained 4.4 per cent to $17.20 and Rio Tinto climbed 4.1 per cent to $97.18. South32, bolstered by rising aluminium prices, added 4.8 per cent to $3.70.

Goldminers Northern Star and Newcrest recovered somewhat after hitting multi-year lows on Wednesday as rising interest rates take a toll on the non yield-bearing asset. But Evolution fell again, dropping 0.4 per cent to $2.40.

On interest rates, global markets were digesting the release of US Federal Reserve minutes from last month’s meeting where the central bank raised rates by 75 basis points, the biggest hike in 28 years.

A similar-sized hike could be coming later this month, the minutes indicated, with a 50 basis point hike also on the table.

“Despite the consistent hawkish stance of the reserve bank, investors doubt an ongoing aggressive tightening policy on the back of a sharp decline in economic growth,” said Tina Teng, Asia-Pacific markets analyst with CMC Markets.

In the financial sector, NAB was flat at $28.15 while the other three big banks gained ground.

ANZ climbed 1.8 per cent to $22.80, CBA rose 1.2 per cent to $93.08 and Westpac rose 0.8 per cent to $20.

Bendigo and Adelaide Bank rose 1.1 per cent to $9.37 after agreeing to buy ANZ’s $715 million margin lending business.

Pinnacle Investments rose 7.6 per cent to $8.18 after announcing 10 of its affiliates had earned $57.1 million in performance fees, of which Pinnacle’s share is $16.4 million.

The energy sector was flat as Brent crude slumped below $US100 for the first time since late April.

Santos fell 1.7 per cent to $6.90 but Woodside rose 0.3 per cent to $30.28 and Beach was up 1.9 per cent at $1.64.

Industrials were the biggest laggard, falling 0.8 per cent as Brambles dropped 2.7 per cent and Auckland Airport fell 1.9 per cent.

In tech, Link Group rose 6.3 per cent to $4.07 after Canada’s Dye & Durham increased its offer for the superannuation solutions provider to $4.57 a share.

Bubs Australia dropped 9.0 per cent to 55.5c despite announcing that the US Food and Drug Administration is providing a pathway for it to potentially continue its baby formula imports to the United States even after the shortages there ease.

Meanwhile the Australian dollar remained close to a two-year low against its surging US counterpart. It was buying 68.10 US cents, from 68.18 US cents at Wednesday’s close.


* The benchmark S&P/ASX200 index closed on Thursday 53.5 points higher, or 0.8 per cent, at 6648.

* The broader All Ordinaries gained 52.6 points, or 0.78 per cent, to 6836.9.


One Australian dollar buys:

* 68.10 US cents, from 68.18 US cents at Wednesday’s close

* 92.53 Japanese yen, from 92.48 yen

* 66.73 Euro cents, from 66.41 cents

* 56.96 British pence, from 56.89 pence

* 110.27 NZ cents, from 110.33 cents

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