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The share market rose for the fourth time in five sessions as falling fuel prices soothed inflation worries and futures markets indicated US interest rates may not rise as much next week as investors originally feared.

The S&P/ASX 200 climbed 81.5 points or 1.23 per cent to its highest close this month.

Tech, banking and resource stocks led the advance. Defensive assets such as healthcare providers and supermarkets dragged.

What moved the market

Investors took advantage of a respite in the headwinds pressuring equity markets this year, encouraged by an end-of-week rally on Wall Street. US stocks bounced as Federal Reserve officials talked down the risk of a full percentage point increase in the central bank’s benchmark rate next week.

Atlanta Fed President Raphael Bostic said the bank should not move too dramatically for fear of undoing a lot of positive trends in the economy. San Francisco Fed President Mary Daly downplayed the threat of recession as rates return towards “neutral”. Daly said rates were likely heading from near zero to somewhere in the 3% range.

“I don’t have recession high on my list of outcomes,” Daly added.

Futures pricing showed the odds on a 100 bp increase fell to 19 per cent from 63 per cent earlier in the week. Investors responded by lifting the S&P 500 1.92 per cent and the Dow 2.15 per cent.

Back home, data showed pump prices fell last week, easing pressure on consumers. The national average price for unleaded petrol declined eight cents to $2.04 a litre, according to the Australian Institute for Petroleum. Wholesale prices declined by 17.5 cents per litre.

“The good news for motorists is that crude oil prices have been falling on concerns that global rate hikes will lead to slower economic activity,” CommSec’s chief economist Craig James said.

“The terminal gate (or wholesale) price in Australia has fallen around 30 cents a litre from highs. National average pump prices have fallen just 8 cents a litre, so savings lie ahead for consumers and transport companies,” James added.

CommSec expects the national average price to drop nearer $1.85 a litre.

Brent crude dipped back under US$100 a barrel this morning before steadying. The international oil benchmark was lately up US$1.53 or 1.5 per cent at US$102.69 after trading beneath US$99.50.

Winners’ circle

The beleaguered tech sector climbed almost 2.9 per cent to a six-week high as interest rate worries continued to ease. BrainChip popped 13.87 per cent, Life360 8.24 per cent and WiseTech 7.16 per cent.

EML Payments climbed 7.35 per cent after confirming media reports of takeover interest. The payments platform provider said the board considered two change-of-control proposals last month, but discussions had since ceased.  

A mid-morning rebound in Brent boosted energy providers. Santos put on 2.43 per cent. Woodside Energy gained 2.19 per cent. Beach Energy firmed 3.31 per cent.

Suncorp jumped 6.13 per cent after selling its banking business to ANZ for $4.9 billion. The acquisition hands ANZ $47 billion in home loans, $45 billion in deposits and $11 billion in commercial loans.

The Queensland insurer said the sale of Suncorp Bank would continue the “reshaping and simplification of the Suncorp Group, and positions both the insurance and banking businesses for ongoing growth and success”.

ANZ placed its shares in a trading halt while it tapped capital markets. The acquisition will be partly funded by 1 for 15 pro rata accelerated renounceable entitlement offer. The bank also announced net interest margins improved by five basis points last quarter to 1.63 per cent as interest rates rose.

Upbeat trading updates from US giants Citigroup and Wells Fargo helped lift the rest of the financial sector. Macquarie Group climbed 3.18 per cent, Westpac 1.26 per cent, NAB 1.93 per cent and CBA 1.04 per cent.

Record coal prices and solid production helped drive Whitehaven up 5.17 per cent to a new record. The coal miner expects to report full-year earnings of approximately $3 billion after meeting production guidance.

Rivals New Hope and Coronado climbed 2.87 and 0.6 per cent, respectively. The three coal miners were the index’s best performers last week, logging double-digit gains.

A contract win helped lift Worley 2.28 per cent. The project manager said it had won three-year design and construction contracts from Saudi Arabian oil and gas giant Aramco.

A 10.3 per cent dip in Q4 sales revenue helped push Lynas Rare Earths down in morning action before an afternoon recovery of 0.74 per cent. Production was affected by water shortages in Malaysia. Strong prices helped the miner report record sales receipts of $351 million.  

Doghouse

The flipside to today’s improvement in risk appetite was pressure on defensive corners of the market. Biotech CSL slipped 0.87 per cent, supermarket Coles 0.69 per cent and Woolworths 0.24 per cent.

APA Group shed 2.25 per cent, A2 Milk 2.44 per cent and NIB Holdings 2.37 per cent.

Legal costs and lower sales are expected to cut analytical software firm Nuix‘s full-year earnings by more than half. The firm expects earnings before interest to be in the range of $10-$12 million, down from $30.5 million last fiscal year. The share price sank 13.01 per cent to a fresh all-time low.

Other markets

Asian markets built steadily all session. By the Australian close, the Asia Dow was up 1 per cent, China’s Shanghai Composite 1.48 per cent and Hong Kong’s Hang Seng 2.64 per cent. Trade in Japan was suspended for a public holiday.

US futures overcame a brief morning wobble to advance strongly. S&P 500 futures were recently ahead 21 points or 0.55 per cent.

Gold rallied US$11.40 or 0.7 per cent to US$1,715 an ounce.

The dollar regained 68 US cents this morning, lately buying exactly 68 US cents.

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