Resources propel market to nine-month high
The sharemarket hit its highest level since October yesterday a nine-month high after Chinas central bank said it planned to increase the supply of cash to the worlds second-biggest economy.
The sharemarket hit its highest level since October yesterday a nine-month high after Chinas central bank said it planned to increase the supply of cash to the worlds second-biggest economy.Australian resource stocks, which account for about a quarter of the local bourse by market capitalisation, reacted positively to the news, which in turn pulled the market higher.The benchmark ASX 200 index closed up 14 points, or 0.3 per cent, at 4362.7, while the broader All Ordinaries index was up 14.1 points, or 0.3 per cent, at 4441.3.The head of research at ATI Asset Management, David Liu, said investors had enjoyed some strong days from the miners and energy companies, with the release of positive quarterly production reports from BHP Billiton, Rio Tinto and Woodside Petroleum, as well as an update from Fortescue Metals.Looking at the flow of funds over the past few days, theres definitely been a move into BHP Billiton and Rio and some of the large miners, thats probably the most significant thing, Mr Liu said.The consensus trade has, until recently, been underweight resources and overweight financials. Thats coming back a little bit.BHP shares climbed 40? to $35.50, while Rio Tinto rose 10? to $66.60. Fortescue gained 9? to $6.02, despite third-quarter iron ore production falling below guidance following the cyclones in Western Australia.Oil and gas producer Woodside climbed 49? to $35.04 after the company maintained its full-year production target and increased first-quarter revenue. Santos rose 4? to $14.04 as higher oil and gas production and stronger prices lifted first-quarter revenue by 50 per cent.Among the banks, the Commonwealth was flat at $50.78 after it announced its plans to grow market share.Westpac dipped 4? to $22.02, ANZ rose 4? at $23.30, and National Australia Bank added 6? to 25.24.Ports and rail operator Asciano rose 4? to $4.79 as it reached agreement with the Maritime Union of Australia on a new enterprise agreement for container terminal workers.Telstra was up 3? at $3.39 after it said it expected to generate up to $3 billion in extra cash over the next three years as a result of its agreement with the federal government for the rollout of the national broadband network.Australian Pharmaceutical Industries rose 3? to 37? as it said it planned to continue expanding its chain of Priceline pharmacies despite the gloomy outlook for the retail sector.ALL ORDS AUSTRALIAAPR 19HIGH 4453.7LOW 4425.64441.3 14.1 (0.3%)