BHP production report puts spark into market
THE sharemarket edged higher yesterday after BHP Billiton said it had enjoyed record levels of iron ore production in the December quarter.
THE sharemarket edged higher yesterday after BHP Billiton said it had enjoyed record levels of iron ore production in the December quarter.The news countered falls in financial stocks, which retreated following a World Bank warning of a second global financial crisis.The benchmark S&P/ASX 200 rose 2.3 points to 4217.9, and the broader All Ordinaries gained 2.9 points to 4280.6.BHP Billiton, the world's largest mining company, released a report showing second-quarter iron ore production had risen to a record high, driven by mine and port expansions in Western Australia.Iron ore output was 41.1 million tonnes in the three months to December 31, compared with 33.7 million tonnes a year earlier.Shareholders welcomed the news, pushing BHP shares 30? higher to $37, while rival Rio Tinto benefited from the positive sentiment, gaining 90? to $66.60."Resource stocks have been a talking point in Australia after BHP Billiton posted its quarterly production report," the IG Markets strategist Stan Shamu said. "The report [was] well received and largely beat estimates with solid numbers in the three key businesses of iron ore, petroleum and base metals."The session got off to a weak start after investors locked in gains from the previous day.Yesterday morning's falls were compounded by warnings from the World Bank that the global economy was on the verge of a second financial crisis, which pushed financial stocks lower.ANZ Bank suffered the most, closing 26? lower at $20.79, while National Australia Bank dropped 14? to $23.66 and Westpac slipped 9? to $20.57.But despite the falls, there was enough momentum to push the market into positive territory with industrial, materials and energy stocks doing some heavy lifting.Newcrest Mining rose 36? to $32.77. Energy stocks also gained, with Woodside Petroleum climbing 46? to $34.11, and Orica Energy adding 61? to $25.37.Retailers finished the day lower after Specialty Fashion Group became the latest fashion brand to downgrade its profit forecasts. The shares fell 8.5 per cent to 43?.The news "highlights very well the two-speed economy in Australia," the City Index analyst Peter Esho said.David Jones bucked the trend to close up 1.7 per cent at $2.36 after the company said it expected to generate more than $40 million in sales per year from a new department store in Brisbane's south-west.The Australian dollar was steady against the US dollar.with AAP