Market perks up despite gloomy signs
THE sharemarket put in an impressive performance yesterday, despite further signs of weakness in the economy, as markets across Asia exploited a weak but positive lead from Wall Street before a crucial US Federal Reserve policy meeting.
THE sharemarket put in an impressive performance yesterday, despite further signs of weakness in the economy, as markets across Asia exploited a weak but positive lead from Wall Street before a crucial US Federal Reserve policy meeting.The benchmark S&P/ASX 200 Index was up 50.9 points, or 1.2 per cent, at 4247.6.The market enjoyed a boost from technical traders, when the S&P futures broke through last month's high, triggering traders' stop-losses. The event helped propel markets higher across Asia, with the ASX 200 one of the strongest performers.Healthcare and materials stocks led the way, with every industry sector making gains.BHP Billiton was up 44?, or 1.3 per cent, at $35.15, and Rio Tinto rose 61? to $64.35.In the oil and gas sector, Woodside added 4? to $35.90, but Oil Search shed 5? to $6.99, and Santos backtracked 8? to $14.40.Investors shrugged off any concerns about Chinese growth and instead looked forward to this morning's US Federal Reserve meeting.Analysts said US Federal Reserve chairman Ben Bernanke would probably keep rates at historic lows, which in turn would support global sharemarkets."Job gains in the US have been inching higher and the unemployment rate has been steady at a high level," National Australia Bank head of research Peter Jolly said."The US economy has some good momentum, and the [US Fed] will acknowledge that. So they won't do anything to upset the momentum, they'll promise to keep policy accommodative."Figures from the Australian Bureau of Statistics showed new home loans fell in January for the first time in 10 months.Considered a leading indicator of the housing market because people get their finances organised before buying a home the value of all home loan lending dropped by 2.3 per cent, with the number of new owner-occupier loans falling 1.2 per cent.The latest NAB business confidence index, which surveyed 500 businesses between February 20 and 24, showed confidence fell to a five-month low of 0.9 in February.The banks made solid gains, including Macquarie Bank, which was downgraded by Fitch ratings agency. Investors were unfazed after Macquarie Group said the downgrade related to global market issues, rather than anything specific to Macquarie. Its shares gained 42? to $26.67.The worst-performing stock on the S&P/ASX 100 Index was retailer JB Hi-Fi, down 17?, or 1.6 per cent, at $10.65.