Positive signs on US economy lifts market
The sharemarket put in an impressive performance yesterday, despite further signs of weakness in the local economy, as markets across Asia exploited a positive lead from Wall Street before a crucial Federal Reserve policy meeting.
The sharemarket put in an impressive performance yesterday, despite further signs of weakness in the local economy, as markets across Asia exploited a positive lead from Wall Street before a crucial Federal Reserve policy meeting.The benchmark S&P/ASX200 index was up 50.9 points, or 1.2 per cent, at 4247.6, while the broader All Ordinaries rose 48.3 points, or 1.1 per cent, to 4336.5.The local bourse enjoyed a boost from technical traders about mid-morning when the S&P futures broke through February's high, triggering traders' "stop losses". The event helped propel markets higher across Asia, with the ASX200 one of the strongest performers.Healthcare and materials stocks led the way with every local industry sector making gains, but some companies failed to capitalise on the positive mood.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 rose 4? to $35.90 but Oil Search shed 5? to $6.99, and Santos fell 8? to $14.40.Investors shrugged off any concerns about Chinese growth and instead looked forward to this morning's meeting by the Federal Reserve.Analysts said the Fed 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," the research head at NAB, Peter Jolly, said."The US economy has some good momentum and the [Fed] will acknowledge that [in their meeting], so they won't do anything to upset the momentum, they'll promise to keep policy accommodative."New figures from the Australian Bureau of Statistics show 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 instalment of the NAB business confidence index, which surveyed 500 businesses between February 20 and 24, showed confidence fell to a five-month low of 0.9 last month, below the long-run average of 6.4.The major banks made solid gains, including Macquarie Group, whose banking arm 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. Macquarie shares rose 42? to $26.67.The worst performing stock on the S&P/ASX 100 index was retailer JB Hi-Fi, down 17? at $10.65.with AAP