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The share market marked a third week of gains with a fresh nine-month high as strengthening commodity prices helped offset falls on Wall Street.

The S&P/ASX 200 climbed 17 points or 0.23 per cent this session to 7452.2. The Australian benchmark last closed higher in April.

Miners of gold, coal and battery metals led today’s advance, with support from healthcare providers and energy producers. Those gains were partly offset by falls in consumer stocks, banks and telecoms.

What moved the market

The market’s sparkling start to the year continued into a third week as softening in the labour market sharpened hopes that the top in this interest rate cycle may not be far off. Investors still expect the Reserve Bank to raise official rates by a quarter-point next month, but a pause later in the year looks increasingly likely after job losses last month.

Stocks surged after data yesterday showed total employment declined by 14,600 jobs in December. The report helped soothe concerns about the rates outlook following an uptick in inflation towards the end of last year. Market pricing for the terminal rate in this rates cycle has fallen from 4 per cent towards 3.5 per cent in recent days.

“As far as the official cash rate is concerned, there is a growing chance that the RBA can soon give some breather by skipping even a 25 bps hike in its upcoming meeting,” Kunal Sawhney, chief executive of research group Kalkine, said.

“Inflation is still hovering at a higher level in the domestic economy, but the recent slowdown of prices in the US raises hopes of similar outcomes in Australia, thanks to last year’s persistent rate hikes, which is slowly dealing the desired blow to the price monster.”

Data this week showed traffic volumes in China were back near normal for this time of year. Subway usage in cities and passenger flights have also rebounded strongly.

“Suggests the economic disruption to the Chinese economy from the reopening surge in Covid cases may be over (baring another wave),” AMP’s chief economist Shane Oliver tweeted.

Today’s advance expanded the index’s gain since the start of the year to 5.9 per cent. It also lifted the index to within around 2.4 per cent of its 2021 all-time high.

What is most notable is that the local market has continued to grind higher this week despite three straight daily losses in the US. The S&P 500 and Dow both fell 0.76 per cent overnight as traders mulled mixed signals about the economy.

Winners’ circle

Lithium miner Pilbara Minerals jumped 13.18 per cent after reporting improvements in key metrics last quarter. Production increased 10 per cent quarter-on-quarter, shipments 8 per cent, sales 33 per cent and cash on hand by 62 per cent. Operating costs shrank 5 per cent.

Whitehaven Coal jumped 6.16 per cent after overcoming wet weather to deliver record quarterly production. The miner expects to report first-half earnings of $2.6 billion after increasing production by 21 per cent in the December quarter from the previous three months.

Kiwi health product manufacturer Fisher & Paykel popped 4.87 per cent to a ten-month high after reporting strong demand from China as Covid spreads. The company expects full-year operating revenue of NZ$1.55-NZ$1.6 billion.

Managing Director and Chief Executive Officer Lewis Gradon said, “Consistent with what we experienced during COVID-19 surges over the last few years, we are seeing increased sales of our Hospital hardware and consumables in China as the country manages its current wave of the virus.

“An early start to the flu season and the prevalence of respiratory syncytial virus (RSV) also fueled demand for our Hospital consumables in North America during the final months of 2022, though this now appears to be easing.”

Karoon Energy firmed 3.35 per cent after securing approval to drill in Brazil. The oil and gas explorer said drilling would commence on the first of two planned control wells at its Neon discovery in the next few days.

A seven-year contract worth US$25 million with a US academic healthcare business lifted Pro Medicus 1.84 per cent. The company’s US subsidiary signed a deal to provide diagnostic imaging to the University of Washington’s UW Medicine in Seattle.

Doghouse

Lithium miner Liontown Resources slumped 8.33 per cent after warning of a cost blowout at its Kathleen Valley site.

“The combination of optimisation, additional scope and cost escalation has resulted in Kathleen Valley’s estimated capital cost to first production from the process plant increasing to $895m inclusive of $40m in contingency,” the company reported.

The company said it had altered the plant design to improve initial throughput to take advantage of strong lithium prices. It had spent $73 million on the project so far, with $685 million of funds still available.

The owner of the Rebel, Macpac, BCF and Macpac brands dipped 0.48 per cent after landing in court over underpayments to staff. The Fair Work Ombudsman filed proceedings in the Federal Court against Super Retail Group over previously disclosed errors in staff payments. The company self-reported the matter and said it had paid back more than $52.7 million to current and former employees.

Clothing retailer City Chic Collective lost 7.69 per cent as a reduction in inventory and a focus on cost management failed to offset news of a first-half loss of $2.5-$4 million. The company said it remained on track to reduce inventory from around $163-$164 million to $125-$135 million by the end of FY23.

Fund manager Perpetual hit a two-month high in early action after increasing assets under management by 4 per cent in the second quarter to $93.7 billion. The company said its acquisition of rival Pendal was due to complete on Monday. Shares traded as high as $27.41 before fading to a loss of 0.76 per cent at $26.20.

Other drags included Nanosonics -6.64 per cent, Pinnacle Investment -3.76 per cent and Challenger -3.5 per cent.

Among the heavyweights, James Hardie eased 1.82 per cent, Telstra 0.96 per cent and Macquarie Group 0.65 per cent.

Other markets

US futures rebounded with Asian markets. S&P 500 futures climbed nine points or 0.23 per cent.

The Asia Dow put on 0.46 per cent, China’s Shanghai Composite 0.54 per cent, Hong Kong’s Hang Seng 1 per cent and Japan’s Nikkei 0.3 per cent.

Oil climbed to its highest since December. Brent crude rallied 17 US cents or 0.2 per cent to US$86.33 a barrel.

Gold rose US$3.20 or 0.17 per cent to US$1,927.10 an ounce.

The dollar rebounded 0.1 per cent to 69.17 US cents after falling below 69 cents overnight.

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