ASX climbs to three-month high on miners

Super Retail Group jumped 8.6 per cent to $7.57 following a trading update. While the update showed growth at BCF storesslowed year to date, Super Cheap Auto sales rose 4.4 per cent from 3.5 per cent in the December half and Rebel Sport's sales rose 2.2 per cent from 1.1 per cent in the December half.

​Early education provider G8 Education is predicts that changes to government subsidy of child care set to start in the second half of the year will help increase its profits. The subsidy is set to reduce the out of pocket costs for families putting their children in childcare. G8 Education closed at $2.34, up 6.9 per cent.

NAB fell after the bank released its half-yearly results. It revealed cash earnings in the first half of 2018 fell by 16 per cent to $2.8 billion from the first half of 2017, causing shares to drop 0.6 per cent to $29.39.

InvoCare shfell for the second day in a row after the company cut profit forecasts for the 2018 financial year as funeral sales fell. Shares dropped to $11.65, down 4 per cent.

Healthscope dropped slightly, finishing at $2.40, down 2.8 per cent. The shares remain over the $2.36 a share bid price offered by a BGH Capital led consortium last week.

Stock watch

Nine Entertainment

Credit Suisse believes Nine Entertainment has won the free-to-air sports rights battle, citing its recent capture of the Australian Open tennis rights as a big positive for the company. Upgrading its rating from "neutral" to "outperform", the broker said its relinquishing of the cricket coverage would allow to to make production savings. "In our view, the switch from domestic cricket (which we estimate lost $50-60mn per year on a standalone basis) to Australian Open tennis is a more efficient allocation of programming resources," Credit Suisse said. Nine will not have either the cricket or tennis broadcast during the 2019 financial year, but the broker said the outlook remained relatively fluid for the company as the company sought to reinvest the savings. The broker upgrade the company's target price from $2.35 to $2.60 as it expects earnings to increase from the reduced programming cost base.

What moved the market

Services sector

The CBA Services Purchasing Managers Index (PMI) eased slightly in April although expectations for the remainder of the year are remaining strong. The index dropped from 55.6 in March to 55.2 in April, showing that the Australian services sector is continuing to perform well above the long-run average. The results showed that most PMI sub components were also sitting above the average as strong demand makes it easier to pass on rising input costs. CBA's chief economist Michael Blythe said the results show wages are starting to rise. "Strong growth in business is supporting jobs growth," he said. "And they are reporting that wages bills are lifting as workforces expand and pay levels lift."

Aluminium

Aluminium prices rose 2.9 per cent at $US2,326 a tonne after US President Donald Trump extended exceptions to the administration's tariffs on aluminium for another month. Washington also reached an '"in principle deal" to grant permanent tariff exemptions to Australia, Argentina and Brazil, although on Thursday morning, the Brazilian government denied a deal had been reached. Aluminium has been trading with increased volatility over the past few weeks as the US makes changes to its tariffs on the metal. Prices have settled lower for now following a seven-year high of $US2,718 on April 19. Aluminium stocks have fallen to 880,350 tonnes, close to an eleven year low, helping support the price increase.

Euro

The Euro was down in trade on Tuesday night, recording one of the worst drops of the major currencies. The fall has taken the currency back to prices it had at the start of the year. EU data didn't help, with quarterly results showing the EU grew at 0.4 per cent in the first quarter of 2018, down from 0.7 per cent in the fourth quarter of 2017. Analysts say the slowdown in growth was due to bad weather and an underlying slowdown from the rapid pace of growth it experienced during 2017. The EU is due to release its advance April CPI readings this week and the market is looking for the year on year Core number to ease from 1 per cent to 0.9 per cent.

Building approvals

Residential building approvals have risen 2.6 per cent through March following a 4.2 per cent fall in April. Most of the lift can be put down to the construction of new apartments, where approvals rose 4.6 per cent. While the building approvals are down from their peaks in 2015, levels have remained high. That trend is forecast to change over the next year as dwelling prices fall amid slowing home prices, softer housing loan growth and tighter lending standards. While the strong growth will support GDP growth in the near term, an inflow of new home with push down dwelling prices, particularly for units. AMP senior economist Diana Mousina said that it has been surprising to see unit prices hold up so well despite surges in new apartment supply.