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Mining stocks steered the Australian share market higher as Chinese plans to reopen gathered pace and Fortescue Metals raised its iron ore shipping guidance.

The S&P/ASX 200 rallied 95.7 points or 1.32 per cent to its first gain in four sessions.

Bulk metal miners led after China began lifting Covid restrictions in its steel-making heartland. Fortescue Metals, Sandfire Resources, Nickel Mines and Champion Iron advanced after trading updates. Gold miners Newcrest, Silver Lake Resources and St Barbara declined.

What moved the market

Well-received quarterly reports on both sides of the Pacific encouraged investors to wade back into the market after a three-day rout knocked the ASX 200 down 4.3 per cent.

Fortescue Metals jumped 8.11 per cent after increasing its iron ore guidance. BHP and Rio Tinto also booked strong gains amid reports officials in Shanghai were working on reopening plans as infection rates hit a 24-day low.

The heavily-weighted materials sector lost 12 per cent over the previous four sessions amid fears Beijing might follow Shanghai into lockdown. The closure of Shanghai, the world’s busiest port, disrupted supply chains, upended commodity markets and threatened demand for Australian raw materials.

The local materials sector bounced 3.5 per cent this afternoon following tentative overnight gains in iron ore, crude and some metals.

In the US, an unexpectedly strong quarterly from Facebook owner Meta Platforms sharpened hopes of a market rebound tonight. S&P 500 futures surged 38 points or 0.9 per cent. Nasdaq futures jumped 1.45 per cent as Meta bounced 18.3 per cent in after-market trade.

The rebound in futures overshadowed a mixed finish overnight as the main indices gave up much of their early gains. The S&P 500 clung on to a gain of 0.21 per cent. The Nasdaq Composite dipped 0.01 per cent to its lowest close since November 2020 after being up as much as 1.7 per cent.

Winners’ circle

Fortescue Metals upgraded its guidance after shipping a record 139.5 million tonnes of iron ore over the first nine months. The Pilbara miner raised its full-year shipment forecast to 185-188 million tonnes from previous guidance of 180-185 million tonnes.

The upgrade came after the company increased third-quarter shipments by 10 per cent from the prior corresponding quarter.

Rivals BHP and Rio Tinto rallied 4.37 and 3.52 per cent, respectively, following a tentative rebound this week in Chinese ore. Prices edged higher yesterday after authorities lifted Covid lockdowns in parts of the country’s steel-manufacturing heartland. Champion Iron firmed 4.56 per cent despite a dip in quarterly production.

Record quarterly earnings lifted Nickel Mines 6.06 per cent. A 10.7 per cent increase in production last quarter helped the miner generate $81.7 million in earnings.

Record lithium prices helped offset production issues at Pilbara Minerals as the miner battled resourcing shortfalls. The share price improved 3.46 per cent after the miner reaffirmed full-year production guidance.

Coles edged up 0.6 per cent after increasing quarterly sales revenue by 3.6 per cent to $9.1 billion. The result came as the supermarket battled absenteeism, flooding and inflationary pressures.

Other heavyweights to advance included CSL +1.11 per cent, Wesfarmers +0.7 per cent and ANZ +0.67 per cent.

AMP jumped 13.17 per cent to a five-month high on news it secured up to $699 million for its international infrastructure equity business. US investment firm DigitalBridge will acquire the business for an up-front fee of $462 million. Additional payments are dependent on performance and fund raisings.

Sandfire Resources surged 11.92 per cent from yesterday’s 14-month low after successfully integrating a Spanish acquisition and increasing production at its DeGrussa operation in WA. The miner said the MATSA mine in Spain was producing in line with guidance.

Resolute Mining firmed 3.12 per cent after increasing gold production by 2 per cent last quarter.

Orora climbed 3.43 per cent to an all-time high on news that earnings will increase this financial year, thanks to strength in the packager’s North American business.

Doghouse

Gold miner Silver Lake Resources dropped 6.25 per cent after withdrawing full-year guidance. The miner said intensifying labour shortages and supply-chain disruptions left it unable to predict Q4 performance with confidence.

Newcrest eased 0.96 per cent as news of a 14 per cent decline in quarterly production at the Telfer mine tempered increased output elsewhere. Overall gold production increased 10 per cent, thanks largely to higher mill throughput at Cadia.

St Barbara gave up 2.61 per cent on news production declined 6 per cent last quarter. The miner insisted it remained on track to deliver on full-year guidance.

Uranium miner Paladin Energy dropped 6.67 per cent, Tyro Payments 4.45 per cent and Polynovo 4.62 per cent.

Other markets

Most Asian markets improved with US futures. The Asia Dow advanced 1.17 per cent, Hong Kong’s Hang Seng 0.36 per cent and Japan’s Nikkei 1.73 per cent. China’s Shanghai Composite faded 0.22 per cent.

Oil reversed last night’s rebound. Brent crude declined US$1.69 or 1.61 per cent to US$103.26 a barrel.

Gold‘s losing run extended into a third session. The yellow metal dropped US$12.20 or 0.65 per cent to US$1,876.50 an ounce.

The dollar continued to lose ground, falling 0.37 per cent to 70.95 US cents.

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