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Double-digit gains in shopping centres and oil companies helped the ASX launch a new quarter with a strong advance.

The ASX 200 rallied 151 points or 3 per cent to 5228 by mid-session. The benchmark index climbed as high as 5366 yesterday before fading to a final loss of 2 per cent as fund managers re-jigged their portfolios at the end of a bruising quarter.

The local index has risen in five of the last seven sessions as global markets pared their worst quarterly losses in decades. The S&P 500 wrapped up its biggest first-quarter loss on record with a fall of 42 points or 1.6 per cent, extending its three-month decline to 20 per cent. Here, the ASX 200’s 24 per cent plunge was the heaviest in the index’s 20-year history.

The local market’s surge this morning was fuelled by rebounds in pockets of the economy that have underperformed over the last week. Shopping centre landlords have been under the pump after retailers shut up shop and threatened to withhold rent. Scentre Group, which operates the Westfield brand here, jumped 11.2 per cent after announcing it had secured additional lending facilities to tide it over the Covid-19 pandemic. Rival Vicinity Centres climbed 11.1 per cent. European centre owner Unibail-Rodamco-Westfield put on 7.7 per cent.

Oil Search climbed 16.4 per cent after striking oil in Alaska. The company drilled three wells, hitting oil in all three and producing “excellent flow rates” in the two wells tested. The energy sector rocketed 8.3 per cent to a two-week peak. Santos rose 10.2 per cent, Woodside 9.3 per cent and Beach Energy 8.7 per cent.

The health sector steadied after yesterday’s sharp decline. Gains in CSL +2.4 per cent, Fisher & Paykel Healthcare +0.4 per cent and Cochlear +3.8 per cent offset a 3.2 per cent slump in ResMed.

The mining sector also bounced back. BHP clawed back 3.4 per cent, Rio Tinto 4.2 per cent and South32 6.7 per cent. A solid morning for the banks saw CBA up 2 per cent, ANZ and NAB 0.8 per cent and Westpac 0.9 per cent.

A morning of surprising economic news included an unexpected jump in manufacturing last month as demand for toilet paper, cleaning products and food surged. The Australian Industry Group’s manufacturing index lurched up 9.4 points to 53.7, its first reading in five months above the 50-point level that indicates expanding activity. A volatile measure of building approvals also surprised, surging 19.9 per cent in February when the Covid-19 pandemic was still in its infancy.

The minutes from last month’s emergency Reserve Bank policy meeting showed the bank expects a “material contraction in economic activity” over the first six months of the year. The bank cut the cash rate to a record low 0.25 per cent, set a target yield on three-year government bonds of 0.25 per cent and opened a lending facility to support small and medium-sized businesses.

Most Asian markets declined even as a private measure of Chinese factory activity confirmed yesterday’s unexpectedly strong official reading. Caixin’s manufacturing PMI rebounded to 50.1 last month from a February reading of 40.3. While the Shanghai Composite rose 0.1 per cent, Hong Kong’s Hang Seng shed 0.9 per cent and Japan’s Nikkei 1.3 per cent. S&P 500 index futures sagged 34 points or 1.3 per cent after the White House raised its anticipated death toll from the virus.

Oil continued to steady. Brent crude futures dipped five cents or 0.2 per cent this morning to $US22.71 a barrel after easing two cents overnight. Gold slipped $2 or 0.1 per cent to $US1,594.50 an ounce.

The dollar dipped 0.2 per cent to 61.21 US cents.

What’s hot today and what’s not:

Hot today: Biotechs are queuing up to get skin in the Covid-19 cure game. Noxopharm (ASX:NOX) threw its hat in the ring this morning, announcing it was investigating a treatment for the inflammatory response killing victims of the virus. The company is seeking funding to trial idronoxil as an inhibitor against cytokine storm, a severe inflammatory response to the infection that has been blamed for “most” Covid-19 deaths, according to the company. Idronoxil suppresses the production of “cytokines” that trigger inflammation. The NOX share price was last up 35.7 per cent.  

Not today: Aged care operator Regis Healthcare (ASX:REG) became the latest in a long list of companies to abandon their full-year earnings guidance and defer a dividend payment to preserve cash. Managing Director Dr Linda Mellors said these were “prudent measures” in the “current unprecedented economic and social environment”. The company said the balance sheet was strong and it had access to additional funding if needed. The share price sank 6.6 per cent.

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