Banking on success as high-yielding stocks boost gains to 20-month high
THE Australian market closed at a 20-month peak driven by strong gains for high-yielding stocks.
At the close on Thursday, the benchmark S&P/ASX 200 Index was up 22.4 points, or 0.47 per cent, at 4810.2, while the broader All Ordinaries index gained 21.7 points, or 0.45 per cent, at 4833.8.
The market closed at its highest level since May 2011.
On the ASX 24, the March share price index futures contract was 28 points higher at 4781, with 21,108 contracts traded.
RBS Morgans private client adviser Bill Bishop said many investors were now looking at high-yield stocks such as the major banks and Telstra because of Australia's low interest rates.
"The low interest rates are driving some money out of bank deposits and into the stockmarket," he said. "There's some offshore interest also."
The four major banks all made gains on Thursday.
Commonwealth Bank jumped 57¢ to $63.24, National Australia Bank surged 34¢ to $27.09, Westpac gained 35¢ to $27.10 and ANZ added 6¢ to $26.00.
Telstra was up 1.11 per cent, or 5¢, to $4.56.
However, the mining giants closed mixed.
BHP Billiton gained 10¢ to $37.16 but Fortescue lost 3¢ to $4.63 and Rio Tinto fell 16¢ to $66.29.
Women's fashion retailer Noni B plunged 13.79 per cent to 75¢ after it announced that its interim net profit would fall to between $1.7 million and $1.9 million from $2.4 million in the previous corresponding period.
US stocks closed higher on Wednesday buoyed by strong earnings results in the technology sector and progress in the Washington fiscal budget debate.
The Dow Jones Industrial Average rose 67.12 points (0.49 per cent) to 13,779.33, its highest level since October 2007.
Locally, Sydney gold closed at $US1678.80 a fine ounce, down $US13.55 from Wednesday's close of $US1692.35.
National turnover was 1.61 billion shares worth $3.919 billion, with 460 stocks up, 508 down and 334 unchanged.
The Australian dollar traded lower against a stronger US dollar, despite the release of stronger Chinese manufacturing figures.
Late Thursday, the Australian dollar was trading at US105.14¢, down from 105.39¢ on Wednesday afternoon.
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