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The share market logged its highest close in eight months as gains in the major banks helped offset production downgrades at BHP.

The S&P/ASX 200 poked its head above 7600 for only the third time this year before trimming its advance to 24 points or 0.31 per cent. The index closed at 7592.8, its best finish since last year’s all-time high.

A strong session for industrials, property trusts and banks kept the index on the rise for a fifth session. Positive quarterlies lifted pallets provider Brambles and fund manager Challenger. Tech stocks and materials were among the drags.

What moved the market

Traders have taken advantage of light volumes across the school holidays to lift the index to within a few points of an all-time high. The ASX 200 drew within eight points of a record yesterday before fading. The benchmark closed this afternoon 40 points from the August record.

The quarterly reporting season delivered the session’s best and worst performances. Brambles and Challenger surged on positive profit signals. Cloud-computing firm Megaport lost a fifth of its value on evidence costs were increasing while growth was slowing (more on all below).

Traders looked past a mixed overnight session on Wall Street after a strong after-hours trading update from Elon Musk’s Tesla ignited US futures. S&P 500 futures climbed 22 points or 0.5 per cent this afternoon. Nasdaq futures rallied 0.74 per cent.

Overnight, the blue chips of the Dow put on 0.71 per cent, while the growth stocks of the Nasdaq Composite skidded 1.22 per cent. The broadest of the three major indices, the S&P 500, ended little changed, down 0.06 per cent.

Winners’ circle

Brambles jumped 7.98 per cent on a sales and profit upgrade. The pallets supplier said sales revenues increased 7 per cent last quarter. The company raised its full-year sales revenue growth guidance to 8-9 per cent from previous guidance of 6-8 per cent. Underlying full-year profit is expected to increase by 6-7 per cent, up from a previous forecast of 3-5 per cent growth.

The prospect of a full-year profit near the upper end of guidance lifted Challenger 9.81 per cent to a pandemic-era high. The investment manager expects normalised net profit before tax to be near the upper end of its $430 – $480 million guidance range. Institutional and retail annuity sales increased by 10 per cent last quarter.

A record quarter boosted Santos 1.7 per cent. The company produced 26 million barrels of oil equivalent for record sales revenues of US$1.9 billion, an increase of 25 per cent from the prior quarter.

Elsewhere at the heavyweight end of the market, property giant Goodman gained 2.01 per cent, Macquarie Group 2.07 per cent, Transurban 1.38 per cent and Woolworths 1.08 per cent. CBA firmed 1.04 per cent, NAB 0.99 per cent, Westpac 0.62 per cent and ANZ 0.32 per cent.

Online marketplace Redbubble bounced 3.59 per cent off a 22-month low as increasing revenues helped investors look past a 22 per cent dive in quarterly profit.

CSL firmed 0.94 per cent after raising US$4 billion on the US bond market to fund its acquisition of Swiss giant Vifor Pharma.

Doghouse

Quarterly updates highlighted the impact of labour shortages and Covid isolation measures, particularly in the mining sector. BHP dropped 3.06 per cent after cutting its production guidance for copper and nickel and reporting an 8 per cent decline in iron ore shipments. The miner reaffirmed its full-year outlook for iron ore and coal production.

“While we expect conditions to improve during the course of the 2023 calendar year, we anticipate the skills shortages and overall labour market tightness in Australia and Chile to continue in the period ahead,” CEO Mike Henry said.

Gold miner Evolution was also forced to cut production guidance, citing wet weather and Covid-related labour issues. The miner reduced its full-year guidance to “around 650,000 ounces” from previous guidance of 670,000 ounces. The share price eased 4.82 per cent.

Growth stocks struggled in the wake of last night’s Nasdaq slide. Afterpay parent company Block fell 6.94 per cent, Life360 lost 5.27 per cent and Tyro Payments shed 3.39 per cent. Xero gave up 2.48 per cent, Polynovo 3.6 per cent and Novonix 2.33 per cent.

Increased spending and evidence of slowing growth helped send Megaport down 21.55 per cent to a 12-month low. The cloud-technology company reported capital expenditure increased to $5.4 million last quarter from $4.1 million in Q2. Average revenue per port declined 2.3 per cent.

Zip Co faded 4.56 per cent after announcing it does not expect to reach profitability until FY24. Q2 revenues were $159.2 million, up 39 per cent year on year.

A dip in retail sales pulled drinks retailer Endeavour Group down 3.3 per cent. The owner of Dan Murphy’s and BWS saw retail sales fall 3 per cent last quarter, outweighing a 3.8 per cent increase in the hotels business. Sales were impacted by extensive flood damage to stores and hotels on the east coast.

Other markets

A mixed session on Asian markets saw the Asia Dow drop 0.14 per cent, China’s Shanghai Composite shed 1.44 per cent and Hong Kong’s Hang Seng lose 1.7 per cent. Japan’s Nikkei lifted 1.21 per cent.

Brent crude bounced US$1.51 or 1.4 per cent to US$108.31 a barrel.

Gold eased 30 US cents or 0.02 per cent to US$1,955.30 an ounce.

The dollar was steady at 74.43 US cents.

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