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A record result from Fortescue Metals and a rebound in raw materials helped the share market advance for the first time in three sessions.

The S&P/ASX 200 spent much of the morning underwater before kicking to a mid-session gain of 11 points or 0.15 per cent.

Strong leads from the US helped offset the effect on lenders of pressure on rates. Fortescue Metals jumped 6 per cent after beating its own shipping guidance. Fellow miners BHP, Rio Tinto and Newcrest were the next-best performers at the top end following end-of-week advances in iron ore and metals.

What’s driving the market

The market traded both sides of break-even during a wobbly morning. The index swung from a gain of 40 points to a deficit of 12 points before rising afresh.

Poorly-received profit report from tech leaders Altium and Nuix were outweighed by a strong result from Fortescue Metals. The miner’s shares jumped 6.05 per cent on news shareholders will receive double last year’s dividend payout following a record year.

Fortescue beat its own shipping guidance as strong ore prices helped it increase full-year net profit 117 per cent to US$10.3 billion. The company will pay fully-franked final dividend of $2.11 for a total payout this year of $3.58 per share.  

“We have seen a strong start to FY22 and through operational excellence, sustained focus on productivity and disciplined approach to capital allocation, we will continue to deliver benefits to all our stakeholders,” Chief Executive Officer Elizabeth Gaines said.

Wesfarmers was the biggest drag among the heavyweights, falling 3.26 per cent to a six-week low amid speculation this year’s result will be hard to repeat. The retail conglomerate reported a Covid-fuelled 40.2 per cent jump in full-year net profit on Friday.

Bank stocks declined as Australian bond yields retreated in the wake of a dovish rates outlook from the US Federal Reserve. CBA shed 1.25 per cent, ANZ 1.15 per cent, NAB 0.72 per cent and Westpac 0.96 per cent.

Fed Chair Jerome Powell soothed Wall Street jitters by signalling the bank was a long way from raising official rates. The S&P 500 rallied 0.88 per cent to a record close. The Nasdaq Composite also ended at an all-time high, gaining 1.23 per cent.

Going up

A 3.7 per cent improvement in iron ore prices helped lift BHP 3.02 per cent and Rio Tinto 2.87 per cent. Shares in both companies were the strongest in eight sessions amid signs a five-week plunge in ore prices may have bottomed.

Pilbara Minerals gained 7.73 per cent, Orocobre 6.74 per cent and Alumina 5.07 per cent.

Gold stocks glistered after the yellow metal rallied to a four-week high as the US dollar and bond yields responded to Powell’s speech. Westgold rose 3.81 per cent, Northern Star 3.43 per cent, Regis 3.21 per cent and Newcrest 1.37 per cent.

“Spot gold prices traded to their highest levels since the end of July following Jerome Powell’s speech at the annual Jackson Hole Symposium. Powell’s comments were more dovish than the stance taken by a number of regional Fed presidents,” ING commodities strategists Warren Patterson and Wenyu Yao wrote.

“While tapering could begin this year, much will depend on data and the spread of the delta variant. As a result, the market will be focusing on the US jobs report at the end of this week. A strong number could still put us on track for a September taper announcement.”

Funeral operator InvoCare swung back to profit and raised its dividend as pet cremations gained traction. The company declared a full-year profit of $44 million, up from a reported loss of $18 million in FY20.  Shareholders will receive a final dividend of 9.5 cents per share. The pet cremation business contributed $3.6 million in earnings. The share price soared 8.41 per cent.

Among other companies reporting, BetMakers climbed 7.59 per cent and Adore Beauty 4.16 per cent. Aussie Broadband sagged 1.36 per cent, AF Legal 5.41 per cent, Oneview 6.85 per cent and Booktopia 4.68 per cent.   

Going down

Tech darling Altium slumped 10.8 per cent after pushing out performance targets in the wake of the Covid-19 pandemic. The software company moved revenue and subscriber targets out to 2026 from original targets of 2025. The company also adjusted its earnings margin aspirations. Full-year revenue met guidance at US$191.1 million.

Beleaguered data analytics firm Nuix fell 9.76 per cent on a full-year net loss of $1.6 million. A company talked up for its growth prospects increased revenue by 0.1 per cent to $176.1 million, or 7.4 per cent  on a constant currency basis. Annualised contract value grew 4.1 per cent.

Healius fell 6.05 per cent as a charge from a tax dispute took some of the shine off a 22 per cent increase in revenues. to $1.913 billion. The medical support specialist lost on appeal a case against the ATO concerning tax deductions made for payments to doctors.

Crown Resorts faded 0.64 per cent after the company reported a $261.6 million net loss as earnings dived 77.4 per cent. The wagering group announced a change of leadership last week: former Telstra chief Ziggy Switkowski will replace Helen Coonan as chair.

Shares in takeover target Japara Healthcare eased 0.18 per cent after the aged care provider reported a full-year statutory net loss of $14.1 million. The company said occupancy rates had been depressed by lockdowns.

Recently-listed BlueBet Holdings sagged 9.25 per cent after a US subsidiary missed out on a gaming licence in Arizona.

Other markets

A positive morning across Asian markets saw the Asia Dow rise 0.27 per cent, China’s Shanghai Composite 0.3 per cent, Hong Kong’s Hang Seng 0.25 per cent and Japan’s Nikkei 0.3 per cent.

S&P 500 futures held broadly steady, lately up less than a point or 0.01 per cent.

A hurricane in the Gulf of Mexico kept oil well bid. Brent crude rose 46 US cents or 0.64 per cent to US$72.16 a barrel.

Gold eased 70 US cents or 0.03 per cent to US$1,818.80 an ounce.

The dollar dipped 0.06 per cent to 73.11 US cents.

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