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A second day of strong gains for the big four banks lifted the market into positive territory for a third session.

The S&P/ASX 200 converted a 66-point opening loss into a 19-point or 0.3 per cent advance by mid-session as the big four surged. The reversal extended a two-day rally that had lifted the index 283 points or 5.1 per cent into yesterday’s close.

The local market’s revival from March pandemic lows began to accelerate yesterday as the lagging banks finally added their weight to the recovery. The financial sector climbed 4.25 per cent yesterday and another 5.9 per cent this morning as traders backed a rebound in profits as the economy reopens.

ANZ led the rally in financials, adding a 9.3 per cent rise to yesterday’s 5.7 per cent tally. National Australia Bank backed up yesterday’s 5.7 per cent gain with another 8.9 per cent today. Tuesday’s best performer, Westpac, added 9.1 per cent on top of yesterday’s 6.3 per cent. Sector heavyweight Commonwealth Bank trailled for a second day with an advance of 5 per cent.

The energy sector also resisted a broader market downtrend that lowered eight out of 11 sectors. Beach Energy gained 6 per cent, Santos 3.9 per cent and Woodside 1.6 per cent. Brent crude oil rose 64 cents or 1.8 per cent to US$36.17 a barrel overnight after several African producers raised their asking price in a sign of growing confidence that demand is recovering.

Resource stocks were pressured by fears of a renewed US-China trade war. US President Donald Trump this morning said the US will announce fresh measures against China by the end of the week after Beijing proposed new security laws to suppress dissent in Hong Kong. Fortescue slumped 4.5 per cent, Rio Tinto 3.4 per cent and BHP 2.7 per cent.

A sharp retreat in CSL steered health stocks lower. CSL fell 5.7 per cent, Sonic Healthcare 1.2 per cent, Fisher & Paykel 1 per cent and Ramsay 0.9 per cent.

Post -pandemic recovery candidates outperformed. Broadcaster Southern Cross Media soared 31.1 per cent, British banking group Virgin UK 14.2 per cent and European shopping centre operator Unibail-Rodamco-Westfield 11 per cent.

US index futures edged higher. S&P 500 index futures were recently ahead six points or 0.2 per cent. Overnight, the S&P 500 put on 36 points or 1.23 per cent, briefly trading above its 200-day moving average before paring gains amid reports that sanctions against China were pending. China’s Shanghai Composite dropped 0.3 per cent this morning and Hong Kong’s Hang Seng 0.8 per cent. Japan’s Nikkei gained less than 0.1 per cent.

Oil gave back a portion of its overnight gains this morning. Brent crude eased 32 cents or 0.9 per cent to $US35.85 a barrel. Gold eased $2.80 or 0.2 per cent to $US1,702.70 an ounce.

The dollar trimmed 0.24 per cent off a 1.5 per cent overnight rise, lately buying 66.35 US cents.

What’s hot today and what’s not:

Hot today: Institutional investors who backed Southern Cross Media (ASX:SXL) at record lows in April have been handsomely rewarded. Starved of ad revenue, the radio broadcaster raised capital at a nine cents a share, a whopping 45 per cent discount to the last traded price. This morning the share price climbed more than 30 per cent to 25.5 cents, less than two months later. Retail investors must be cursing their caution: a $19.5 retail entitlement offer at the same price fell short by $6.5 million. That’s a lot of missed profits.

Not today: Carnage in the gold sub-sector this morning as a rotation out of havens into cyclical stocks accelerated. A seven-year high in the precious metal last week lifted the local gold mining index to its strongest level since last August. The index plunged 7.7 per cent this morning after gold slid 1.7 per cent overnight. Saracen Mineral (ASX:SAR) surrendered 11.5 per cent, Northern Star (ASX:NST) 10.4 per cent, Evolution Mining (ASX:EVN) 8.8 per cent and Newcrest (ASX:NCM) 6.5 per cent.

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