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The ASX hit its highest level in a week as gains in CSL, Telstra and most of the banks outweighed declines in Rio Tinto, ANZ and Afterpay.

A closing-auction bounce handed the S&P/ASX 200 a gain of 12 points or 0.17 per cent after the index had finished regular trade narrowly in the red. The late-late recovery gave the index its third gain in four sessions.

What moved the market

A largely patternless session saw some banks and miners rise, some fall. Even the supermarkets finished mixed: Woolworths up 0.25 per cent, Coles down 0.5 per cent. With the index heavyweights largely cancelling each other out, solid gains in bond proxies ultimately tilted the balance. CSL, Telstra and Goodman Group all advanced.

The index’s mid-session push above 6800 was thwarted by negative opens in Asia. Hong Kong and China both started underwater before rallying amid market speculation about Chinese state funds stepping in to support the market.

“Some trader chatter about China’s state funds etc in the market to support stocks,” ForexLive  Currency Analyst Eamonn Sheridan posted. “The rumour is unconfirmed as yet.”  

China’s markets have come under pressure in recent weeks after state officials publicly speculated about potential bubbles in property and equities. The Hang Seng was this afternoon ahead 0.04 per cent after opening more than 1 per cent in the red. The Shanghai Composite was flat at -0.01 per cent after starting the session at its weakest level in three months. The Asia Dow inched up 0.09 per cent.

US futures waxed and waned with Asia. S&P 500 futures were lately up six points or 0.15 per cent after briefly turning negative when China opened.

US stocks closed lower overnight as the anniversary this week of the pandemic bottom and the start of this bull market raised questions about the scale of the rebound. The S&P 500 has gained 75 per cent in 12 months and sits near an all-time high.    

“Is this a bubble?” Garry Evans, chief strategist for global asset allocation at BCA Research, pondered to the New York Times. “I would say there are certainly pockets of the market that look bubbly.”

Overnight, the Nasdaq Composite skidded 2.01 per cent as highly-valued tech megacaps retreated. The S&P 500 dropped 0.55 per cent.

Winners’ circle

Energy stocks rebounded after a shipping mishap in the Suez Canal triggered a sharp recovery in crude. Brent crude bounced 6 per cent overnight after a container ship got stuck in a key transit lane for around 10 per cent of the world’s oil. Beach Energy added 1.75 per cent. Santos and Woodside both edged up 0.3 per cent.

Healthcare, utilities and real estate investment trusts were lifted by yesterday’s three-week low in bond yields. Sonic Healthcare added 1.6 per cent, CSL 1.4 per cent, Goodman Group 0.7 per cent, AGL 0.3 per cent and APA 0.6 per cent. Wesfarmers gained 0.5 per cent.

NAB  was the best of the banks, rising 0.5 per cent, ahead of CBA +0.2 per cent. ANZ dropped 0.4 per cent and. Westpac 0.3 per cent. Macquarie Group climbed 0.8 per cent.

A slim 0.3 per cent advance made Fortescue the pick of the iron ore majors. BHP was unchanged. Rio Tinto dropped 1.6 per cent. Gold miner Newcrest tacked on 0.8 per cent.

Washington H Soul Pattinson hit an all-time high after increasing group profit by 35 per cent to $68.9 million. Chairman Robert Millner said the investment house’s diversified portfolio of assets had performed well during the pandemic. The share price climbed 4.3 per cent.

A 22 per cent increase in statutory half-year net profit to $71 million helped lift Brickworks 4.7 per cent. The brick manufacturer said a drop in North American earning had been offset by a 60 per cent improvement in Australian earnings.

Doghouse

A tech-led rout in the US infected the domestic sector. Afterpay sank 1.9 per cent to its lowest level in more than two weeks. Appen shed 3.5 per cent, Megaport 2.2 per cent and Nanosonics 1.5 per cent.

Resolute plunged 26.2 per cent after the Ghanaian government unexpectedly terminated the lease for the miner’s Bibiani gold mine. The company was in the process of selling the mine for US$105 million to Chinese miner Chifeng Jilong. Resolute said it would take legal advice and seek clarification from the government.

Insurer Suncorp dropped 0.9 per cent after reporting it had received 5,400 claims across the three eastern states following days of extreme rain and flooding. QBE dropped 1.2 per cent and IAG 0.8 per cent.

Gravity took hold of recently-listed services platform Airtasker. Shares that listed at 65 cents on Tuesday hit $1.97 this morning before profit-taking set in, dragging the share price down 22.9 per cent to $1.35.

A2M Milk sank 2.2 per cent to a three-year low. The dairy company’s share price has fallen steadily since the pandemic disrupted its Daigou sales model.

Other markets

Oil trimmed last night’s 6 per cent rebound. Brent crude fell 93 cents or 1.5 per cent to US$63.32 a barrel. Gold rose $1.30 or 0.1 per cent to US$1,734.50 an ounce.

The dollar rallied 0.13 per cent to 75.97 US cents.

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