Resurgent gold price bolsters market
The benchmark S&P/ASX 200 Index closed 15.2 points, or 0.3 per cent, higher at at 5017.1, while the broader All Ordinaries was up 15.7 points, or 0.31 per cent, at 5004.6.
The spot price of gold in Sydney finished at $US1331.05 an ounce, up $US13.35 on the day.
Goldminer Newcrest continued to perform strongly, adding 65¢, or 5.4 per cent, to $12.60.
"The higher commodity prices are a big deal," RBS Morgans private client adviser Bill Bishop said.
The commodity price movements were a positive statement on Chinese growth, he said. "There is a bit more hope around that China is going to be able to rein in some of the wilder lending practices.
"Armageddon isn't about to happen. The Chinese are still buying our iron ore and our coal," he said.
Local gains came with rises on most Asian markets, including Japan, Hong Kong and Shanghai.
"Asia is still going along fairly nicely, and we're not too shabby either," Mr Bishop said. "It's a bit of a bright spot - when you look at Europe, which is a bit of a dead loss."
BHP Billiton gained 38¢ to $34.50, and Rio Tinto added 21¢ to $56.76. Iron ore miner Fortescue was 6¢ lower at $3.62 despite the company reporting a 41 per cent rise in production in the 2012-13 financial year.
The banks posted gains, with Commonwealth Bank up 51¢ at $72.39, Westpac gained 9¢ to $29.49, NAB added 8¢ to $30.49 and ANZ edged 1¢ higher to $28.92.
The dollar hit a one-week high and was trading at US92.59¢ late on Tuesday, up from US92.22¢ on Monday.
CMC Markets trader Betty Lam said the gold price surge helped the dollar by putting downward pressure on the US dollar. "The Aussie dollar is also the happy recipient of the recent gold love-fest," she said. "We see the local currency building on its recent advances for the third consecutive day."
Ms Lam said any sustained support for the dollar would depend on Chinese manufacturing data and the Australian inflation figures, both of which are due on Wednesday.
Meanwhile, bond futures prices were flat before the release of the inflation figures. UBS interest rate strategist Matthew Johnson said futures stayed in a narrow range in quiet trade.AAP
Frequently Asked Questions about this Article…
The article says stronger gold and commodity prices pushed the market higher. The S&P/ASX 200 closed up 15.2 points, or 0.3%, at 5,017.1, while the All Ordinaries rose 15.7 points, or 0.31%, to 5,004.6.
Spot gold in Sydney finished at US$1,331.05 an ounce, up US$13.35 on the day. Commentators in the article said the gold surge helped local markets and supported the Australian dollar by putting downward pressure on the US dollar.
According to the article, Newcrest rose 65¢ (5.4%) to $12.60. BHP Billiton gained 38¢ to $34.50 and Rio Tinto added 21¢ to $56.76.
The article reports Fortescue was 6¢ lower at $3.62 despite announcing a 41% rise in production for the 2012–13 financial year. The piece notes the contrast but does not give a specific market explanation for the share price reaction.
The banks posted gains: Commonwealth Bank was up 51¢ at $72.39, Westpac gained 9¢ to $29.49, NAB added 8¢ to $30.49 and ANZ edged 1¢ higher to $28.92, according to the article.
RBS Morgans adviser Bill Bishop said higher commodity prices were a positive sign for Chinese growth and suggested there is hope China can rein in some risky lending practices. He also noted Asian markets — including Japan, Hong Kong and Shanghai — were rising and described Asia as a relative bright spot versus Europe.
The Aussie dollar hit a one‑week high, trading at US92.59¢ late on Tuesday, up from US92.22¢ on Monday. CMC Markets trader Betty Lam said the gold price surge helped the dollar, and she added that any sustained support would depend on upcoming Chinese manufacturing data and Australian inflation figures due on Wednesday.
The article notes bond futures were flat ahead of the inflation release. UBS interest‑rate strategist Matthew Johnson said futures stayed in a narrow range in quiet trade.
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