Australian share market rises as iron ore soars above $US140 per tonne

In its first trading session after Christmas, the share market rallied on Wednesday as iron ore miners tracked gains in commodity futures.

In its first trading session after Christmas, the share market rallied on Wednesdays as iron ore miners tracked gains in commodity futures. Picture: supplied.

Australian shares rallied in their first post-Christmas session as iron ore futures soared above $US140 a tonne.

The benchmark S&P/ASX200 index added 0.8 per cent, or 59.6 points, to climb to 7561.2 at the closing bell, while the broader All Ordinaries rose by 0.9 per cent, to 7796.7.

At the end of the session, the Australian dollar had added 0.2 per cent to trade at a five-month high of US68.37c.

KCM Trade chief market analyst Tim Waterer said the “festive mood” in markets had continued after Christmas as investors began to feel more optimistic about the economic outlook heading into 2024.

“Essentially, markets are feeling better about the interest rate picture,” Mr Waterer said.

“We’re seeing inflation prints around the globe have been trending lower, which is shifting the mindset of the markets more towards an expected loosening of monetary conditions in 2024.”

Prices for iron ore continued to trade at elevated levels as investors are increasingly optimistic about China’s economic outlook. Picture: supplied.

Mr Waterer said after booking gains in recent weeks, he expected to see investors taking some profit off the table over the coming sessions.

“I wouldn’t be surprised if sometime in the next couple days we could start to see the gains tail off a little bit,” he added.

All 13 industry sectors finished in the green, led by interest rate sensitive real estate and tech stocks which were the strongest performers, up 1.5 per cent and 1.3 per cent, respectively

On the Singapore exchange, iron ore prices on the January contract rose to the highest level in 18 months on optimism that China’s economy and its debt-ridden property sector had finally turned a corner after its post-pandemic lull.

Locally, all sectors finished in the green, led by property trusts, which rose 1.6 per cent.

Technology stocks and materials were also standouts. Liontown was the best performer, advancing 6.3 per cent, while Arcadium Lithium increased 6.2 per cent and Genesis Minerals climbed 4.6 per cent.

In the tech sector, Weebit Nano added 4.5 per cent, while Life360 gained 4.1 per cent. Core Lithium was the session’s poorest performer, closing 7.7 per cent lower, followed by Boss Energy, which fell 2.8 per cent.

ASX heavyweight BHP rose to a record $50.60 intraday, falling to $50.26 at the closing bell, up 1.1 per cent.

Listed iron ore miners reach fresh intraday highs with Rio Tinto climbing to $136.16, before closing up 0.5 per cent to $135.12. Fortescue also breached its previous record, climbing to $28.73 intraday, before finishing up 0.7 per cent to $28.55.

Major shipping operators CMA CGM and Maersk announced the gradual recommencement of their operations in the Red Sea following attacks on vessels by Yemen's Houthi rebels. Picture: AFP / Christophe Simon

With shipping giants Maersk and CMA CGM announcing the gradual restart of their operations in the Red Sea after attacks by Iranian-backed Houthi rebels, Brent Crude prices neared $US81 per barrel.

Energy stocks tracked gains in global crude oil prices, adding 0.5 per cent. Woodside Energy firmed 0.6 per cent to $31.24, Santos rose 0.9 per cent to $7.65, and Karoon Energy jumped 1.5 per cent to $2.06.

In company news, mineral exploration firm Boart Longyear rocketed 57.1 per cent higher to $2.75 after it agreed to a takeover bid from private equity firm American Industrial Partners. The $US371m deal will see the firm delisted from the ASX.

Orecorp shares vaulted 12.8 per cent to 58c after the gold miner accepted a takeover bid from SilverCorp Metals. The deal, priced at 58.9c per share, values OreCorp at $276.5m.

Originally published as Australian share market rises as iron ore soars above $US140 per tonne