Investors embark on shopping spree
KEY earnings results yesterday buoyed investor sentiment, pushing the market to its best close in more than three months.
KEY earnings results yesterday buoyed investor sentiment, pushing the market to its best close in more than three months.The benchmark S&P/ASX 200 Index rose 49 points, or 1.1 per cent, to close at the day's high of 4330.2.The market's broad-based gains were led by the consumer staples sector, up 2.4 per cent, thanks to a strong performance by Coles owner Wesfarmers.RBS Morgans client adviser Bill Chatterton said investors ignored negative leads from the US to snap up big local companies."There's a positive undercurrent," Mr Chatterton said. "We've been nicely surprised by reporting season results, so the market is broadly responding to that."Strong results from AMP also buoyed investor confidence. AMP was 20? higher at $4.36 after its $4 billion merger with AXA Asia Pacific contributed to a 7 per cent rise in underlying first-half profit.Wesfarmers shares rose $1.23, or 3.8 per cent, to $33.72 after strong earnings at its Coles supermarket chain helped lift full-year profit by 11 per cent to $2.1 billion.Among the banks, Commonwealth Bank rose $1 to $57.05, National Australia Bank was 24? stronger at $24.50, Westpac gained 44? to $24.12 and ANZ was 27? higher at $23.90.Resource stocks were mixed, with BHP Billiton up 26?, or 0.8 per cent, at $32.88 and Rio Tinto down 35?, or 0.64 per cent, at $54.74.Analysts said investors were switching out of miners into financial stocks and other sectors as global expectations for further stimulus measures in the US were scaled back."Diminishing expectations of US quantitative easing has given traders reason to continue the switch out of miners into banks, industrials and staples," said CMC Markets trader Ben Taylor."As quantitative easing hopes fade, so does the prospects of higher commodity prices. Our miners are comparatively weaker today against other sectors and investors continue the switch."One of the biggest losers of the day was building materials group Adelaide Brighton, which fell 35?, or almost 11 per cent, to $2.90 despite a $67.5 million first-half net profit that was up 9.8 per cent from the previous corresponding period.ASX shed 11? to $31.30 after it said full-year profit dropped 4 per cent because investor activity had fallen.