Higher commodity prices, offshore rally bolster market
'Reports suggest Berlusconi is on his way out and markets seem to have taken kindly to that news.' Stan Shamu, IG Markets
THE local market gained more than 1per cent yesterday as stronger commodity prices prompted buying of mining stocks.The benchmark S&P/ASX 200 index was up 52.3 points, or 1.22 per cent, at 4346.1, while the broader All Ordinaries index was up 49.4 points, or 1.14 per cent, at 4406.2.The December share price index futures contract closed 60 points higher at 4340, with 30,477 contracts traded.The materials sector led local gains after Wall Street and stronger metals prices provided a boost to the market. Stocks on Wall Street rose after the Italian Prime Minister, Silvio Berlusconi, said he would resign once a budget was passed.Italy has become a key focus for investors this week, with Mr Berlusconi seen as an obstacle to sweeping economic reforms needed to help the country cut its massive debt load and avoid sinking into a financial crisis.An IG Markets analyst, Stan Shamu, said the Australian market opened strongly, due to the positive lead from offshore."Reports suggest Berlusconi is on his way out and markets seem to have taken kindly to that news," Mr Shamu said.The materials sector led the broader market, rising 1.7 per cent.BHP Billiton shares were up 58?, or 1.5 per cent, at $38.33, while Rio Tinto rose 98? to $70.75.Fortescue Metals was 8? higher at $5.10. An Aboriginal corporation was denied the chance to speak at Fortescue's annual general meeting yesterday.Myer shares were among the best performers as the consumer discretionary sector posted solid gains. Myer rose 15?, or 6.4 per cent, to $2.48 after it reiterated its guidance for flat sales for the full year.Other retailers were also higher, with David Jones up 15? at $3.29 and Harvey Norman 7? higher at $2.19.In other news, resources and media company Seven Group Holdings expects its first-half profit to be higher than for the same period last year. The shares rose 20?, or 2.64 per cent, to $7.78.National turnover was 1.84 billion securities worth $4.62 billion.