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The share market logged a fourth straight losing week despite a tepid rebound today in the wake of a Wall Street rally.

A skinny bounce of 16 points or 0.22 per cent this session fell short of breaking the S&P/ASX 200‘s run of weekly losses. The index ended a week dominated by omicron-induced volatility with a five-day deficit of 38 points or 0.5 per cent.

Gains in the major miners and banks outweighed pressure on growth stocks and bond proxies today. BHP, Brambles and Rio Tinto were the pick of the heavyweights. CSL, Afterpay and Coles declined.

What moved the market

Wall Street built the local market a solid platform for a rebound session, then gave it a good shake. S&P 500 futures dived 0.6 per cent this morning after New York reported several omicron cases. The ASX 200 had been up as much as 63 points at the open, but soon turned negative.

The market mood only stabilised once US futures steadied. By the Australian close, S&P 500 futures had trimmed their fall to two points or less than 0.1 per cent. Dow futures turned positive, rising 26 points or 0.1 per cent.

The futures ructions temporarily overshadowed last night’s strong rebound in US equities. The Dow jumped 1.82 per cent and the S&P 500 1.42 per cent.

The spotlight in the US is expected to swing tonight from omicron case numbers back to the economy. A “Goldilocks” November jobs report would reassure investors the recovery remains on track. However, a strong surge in employment would ramp up pressure on the Federal Reserve to taper its asset buying program and raise rates.

“Speculations are rife that the US economy added over a half-million jobs in November as companies became more aggressive in hiring. The unemployment rate might also exhibit a decline as economic revival continues to persist on a firm footing. It remains to be seen if the November job numbers will persuade the Fed to end its massive economic-stimulus strategy quicker than initially planned,” Kalkine Group CEO Kunal Sawhney said.

This morning’s jitters were not helped by a sobering assessment of market conditions from veteran investor Charlie Munger. The billionaire told an Australian conference he believed parts of the market were wildly overvalued. Munger is Warren Buffett’s lieutenant at famed value investor Berkshire Hathaway.

“I consider this era an even crazier era than the dotcom era,” Munger told the Sohn Conference.  

Winners’ circle

Energy stocks rallied after oil traders shrugged off a decision by the Organization of the Petroleum Exporting Countries and allies to increase production next month. The cartel had been widely expected to delay any rise until there was greater certainty about the demand impact of the omicron variant. Crude prices plunged on the news, then recovered as traders interpreted the decision as confidence in the demand outlook.

“It seems that OPEC is in no mood to take hasty decisions as the possible impact of the Omicron variant still appears unclear. Meanwhile, the group has refrained from fighting against the strategic release from the US and other significant oil consumers, leaving room for a larger-than-expected oil surplus,” Kalkine’s Sawhney said.

Oil Search firmed 2.6 per cent, Woodside Petroleum 1.14 per cent and Santos 1.6 per cent.

BHP took a step closer to centralising its operations in Australia. The board decided to unify the miner’s corporate structure under the Australian parent company by delisting in London. The company has been dual-listed since it merged with Billiton in 2001. The share price rose 1.31 per cent to its highest since mid-September.

“Unification will create one parent company, one share register and one share price globally. We believe this is the best structure for BHP to provide the resources the world needs and create long-term shareholder value,” Chair Ken MacKenzie said.

The major banks steadied after yesterday’s mixed session. NAB gained 1.3 per cent, ANZ 1.27 per cent, Westpac 1.17 per cent and CBA 0.74 per cent.

The session’s best performers were Seven West Media +4.35 per cent, Pro Medicus +3.79 per cent and Soul Pattinson +3.34 per cent.

Aside from BHP, the pick of the heavyweights were Brambles +1.9 per cent and Rio Tinto +1.4 per cent.

Doghouse

CSL eased 2.5 per cent after failing to dampen media speculation it was on the verge of the largest acquisition in its listed history. Reports yesterday suggested the health giant was in talks to acquire Switzerland’s Vifor Pharma in a deal worth $10 billion. CSL said this morning it regularly assessed value-creating opportunities, but there was no certainty any transaction would proceed.  

TPG Telecom slid 8.61 per cent on news founder David Teoh reduced his stake in the telco. The former board member sold 53.1 million shares through a block trade, around 3 per cent of the company’s total share capital.

Afterpay remained under the pump, falling 1.78 per cent to a four-month low. The BNPL leader yesterday announced a delay in approvals for its takeover by US giant Square.

Defensive heavyweights were also under pressure. Coles shed 1.7 per cent, Woolworths 1 per cent and Telstra 0.74 per cent.

Flight Centre recovered to finish flat after Regal Funds Management named the travel agent as a target for short sellers. Regal’s chief investment officer Phil King told today’s Sohn Hearts & Minds conference Flight Centre would struggle to regain its pre-pandemic heights.

Other markets

Asian markets waxed and waned with US futures. The Asia Dow cut its fall to 0.04 per cent. Japan’s Nikkei rallied 0.66 per cent. China’s Shanghai Composite added 0.58 per cent. Hong Kong’s Hang Seng slipped 0.74 per cent.

Oil added to overnight gains. Brent crude rose US$1.17 or 1.7 per cent to US$70.84 a barrel.

Gold recouped almost half of last night’s fall, bouncing US$9.80 or 0.56 per cent to US$1,772.50 an ounce.

The dollar continued to lose ground, falling 0.17 per cent to 70.75 US cents.

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