Market up and away after clearing 4300 hurdle
THE sharemarket rose to its highest close of the year, defying weak leads and a regional slump as investors snapped up banks and consumer stocks.
THE sharemarket rose to its highest close of the year, defying weak leads and a regional slump as investors snapped up banks and consumer stocks.The benchmark S&P/ASX200 index rose 42.2 points, or 1 per cent, to 4343.5, its highest since November 9 and firmly established itself above the 4300 hurdle, which had proved a major resistance point over the past eight months. The broader All Ordinaries rose 39.8 points, or 0.9 per cent, to 4431.4.The rally was broad-based, with all sectors posting gains. Financials added 1 per cent, material 0.9 per cent, while consumer staples rose 1.4 per cent and telcos 1.5 per cent.The dollar remained under pressure, slipping to $US1.0435 and hitting lows for the year against the euro and the pound.Yesterday's performance was all the more remarkable as most regional sharemarkets posted losses, following Wall Street's overnight lead. Japan's Nikkei fell 0.7 per cent, while the Hang Seng in Hong Kong was down 0.9 per cent.Options Xpress analyst Ben Le Brun said it was a good session for the local bourse."It's a refreshing change and we've gone sailing past that previous resistance mark at 4300, and things are looking particularly positive," he said. "In the morning session, we just had the defensive end of the market [up] but the cyclical end joined the party in the afternoon and we've just gone from strength to strength."The rally was driven by comments by the Reserve Bank, which said confidence in global financial markets had improved markedly.Mr Le Brun said the market would have a "technical breakout" if it eclipsed the next resistance level of 4360 points, the top end of the trading range at which it had been stuck for the past nine months.Bank stocks were boosted by the Reserve's comment that they were in a good position to address any future turmoil. ANZ was up 27?, or 1.2 per cent, at $23.45, Commonwealth Bank rose 52? to $50.38, NAB rose 28? to $24.94 and Westpac rose 21? to $21.94.Bank of Queensland rose 8.1 per cent to $7.65 after emerging from a trading halt which started on Monday when it announced the sale of new shares to raise $450 million. BoQ also flagged a $91 million first-half loss as a result of falling property values in Queensland.BHP Billiton was up 18? at $34.61, Rio Tinto rose 43? to $64.53 and Fortescue Metals rose 12? to $5.98.Shaw Stockbroking dealer Jamie Spiteri said the market was finally starting to gain a bit of momentum after lagging behind much of the rest of the world recently."BHP and Rio have really struggled to attract ongoing support in our market in recent weeks," he said. "Other areas of our market have gradually improved ... industrials have previously been disappointing but are actually starting to improve off their lows."