Fortescue leads the way on strong day
The benchmark S&P/ASX 200 Index gained 12.8 points, or 0.28 per cent, to 4648, its highest closing since July 8 last year.
Fortescue Metals was a standout performer, up 18¢, or 4.1 per cent, at $4.53 after announcing it would resume work expanding the Kings deposit at its Solomon iron ore mining hub in January after a pick-up in commodity prices.
Other iron ore miners also rose as prices for the steel-making commodity continued to show signs of stabilising, IG Markets analyst Stan Shamu said.
Rio Tinto gained 61¢ to $65.45 and BHP Billiton added 13¢ to $36.99.
Retailers were the other strong performers, on reports of higher turnover at Boxing Day sales.
"The retail sector is having a good day following reports of record festive sales helped by low interest rates," Mr Shamu said. "Festive periods are generally make or break for many retailers."
Myer added 6¢ to $2.13, David Jones gained 7¢ to $2.41, Harvey Norman rose 3¢ to $1.885 and JB Hi-Fi was 3¢ higher at $10.26.
Market activity was lower after the Christmas break, with 849 million shares traded, well below the typical level of about 1.4 billion.
There was little economic news at home or abroad to guide investors, with the main focus still on negotiations in the US to avoid the so-called fiscal cliff. Members of Congress are expected to resume negotiations on Thursday in Washington, but there are no signs of any agreement on measures to reduce the impact of spending cuts and tax rises due to begin on January 1.
Bank shares fell on Thursday, possibly in response to the impending fiscal cliff situation, as well as profit-taking by investors, Mr Shamu said.
Commonwealth Bank shed 21¢ to $62.12, Westpac lost 7¢ to $26.10 and ANZ closed 6¢ lower at $24.91. NAB bucked the trend, adding 7¢ to $24.95.
The spot price of gold closed at $US1655.60 an ounce in Sydney, down $US3.63.
Meanwhile, the dollar closed below US104¢ for the first time since November as investors poured into the US dollar amid US budget talks. The dollar was trading at US103.57¢, down half a per cent from the pre-Christmas close.
The bond market closed flat to weaker as a positive day for local stocks dampened demand for fixed-income assets. The December 10-year bond futures contract was trading at 96.67 (implying a yield of 3.33 per cent), down from its pre-Christmas close of 96.68 (3.32 per cent). The three-year contract was at 97.27 (2.73 per cent), unchanged.
Frequently Asked Questions about this Article…
The S&P/ASX 200 rose 12.8 points (0.28%) to 4,648, its highest close since July 8 last year. Gains were driven by strength in iron‑ore miners and retailers, while overall market momentum was supported despite lighter post‑Christmas trading volumes.
Fortescue Metals rose 18 cents (4.1%) to $4.53 after announcing it would resume work in January to expand the Kings deposit at its Solomon iron‑ore mining hub, citing a pick‑up in commodity prices as the reason for restarting the project.
Other iron‑ore miners also gained as signs of stabilising steel‑making commodity prices lifted the sector: Rio Tinto rose 61 cents to $65.45 and BHP Billiton added 13 cents to $36.99. The article links the miners' gains to improving iron‑ore price conditions.
Retailers strengthened on reports of higher Boxing Day turnover. Examples cited: Myer added 6 cents to $2.13, David Jones rose 7 cents to $2.41, Harvey Norman gained 3 cents to $1.885 and JB Hi‑Fi was 3 cents higher at $10.26.
No — trading was quieter than usual after the Christmas break. About 849 million shares traded, well below the typical daily level of roughly 1.4 billion shares, so price moves occurred on lower volume than normal.
Bank stocks slipped possibly due to investor concerns about the looming US 'fiscal cliff' and some profit‑taking. The article reports Commonwealth Bank fell 21 cents to $62.12, Westpac lost 7 cents to $26.10, ANZ closed 6 cents lower at $24.91, while NAB bucked the trend and added 7 cents to $24.95.
The spot gold price in Sydney closed at US$1,655.60 an ounce, down US$3.63. The Australian dollar slipped below US104¢ for the first time since November, trading at US103.57¢ (about a 0.5% fall from the pre‑Christmas close). Bond futures were flat to a touch weaker: the December 10‑year futures traded at 96.67 (implying a 3.33% yield) and the three‑year was at 97.27 (2.73%).
The article notes US lawmakers were negotiating to avoid the so‑called fiscal cliff, with talks expected to resume but no signs of agreement. Investors should be aware that geopolitical and fiscal negotiations can affect market sentiment — for example, they were cited as a possible reason for weakness in bank shares — so monitoring developments can help explain short‑term market moves.
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