Shares swing higher on optimism spurt
THE sharemarket rallied yesterday to a near five-month high after the Reserve Bank said global market sentiment had improved since late December.
THE sharemarket rallied yesterday to a near five-month high after the Reserve Bank said global market sentiment had improved since late December.The S&P/ASX 200 Index climbed clear of the 4300-point level, gaining 42.2 points, or 1 per cent, to 4343.5.Options Xpress market analyst Ben Le Brun said it was a stunning session for the market, which outperformed Asian markets despite negative leads from the US and Europe and lower prices for some commodities."It's a refreshing change and we've gone sailing past that previous resistance mark at 4300 and things are looking particularly positive as it stands at the moment," Mr Le Brun said."All sectors of the market, with the exception of utilities, are in positive territory. In the morning session, we just had the defensive end of the market in the green, but the cyclical end joined the party in the afternoon and we've gone from strength to strength."The rally was driven by comments by the Reserve Bank that confidence in global financial markets had improved markedly since the crisis over eurozone debt in mid to late 2011.Mr Le Brun said the Australian market would have a "technical breakout" if it eclipsed the next resistance level of 4360 points, which was the top end of the trading range it had been stuck in for the past nine months.Bank stocks were boosted by the RBA's comment that they were in a good position to withstand any turmoil.ANZ was up 27 (1.2 per cent) at $23.45, Commonwealth put on 52? (1 per cent) to $50.38, National Australia Bank appreciated 28? (1.1 per cent) to $24.94 and Westpac advanced 21? to $21.94.Bank of Queensland jumped 8.08 per cent to $7.65 after emerging from a trading halt entered into on Monday when it announced the sale of new shares to raise $450 million.BOQ also on Monday flagged a $91 million first-half loss as a result of falling property values in Queensland, raising the number of its bad loans.BOQ said yesterday it had so far raised $284 million from institutional investors.Among the major miners, BHP Billiton was up 18? at $34.61, Rio Tinto found 43? to $64.53 and Fortescue Metals gained 12?, or 2.1 per cent, to $5.98.In the energy sector, Woodside was up 48?, or 1.4 per cent, at $35.77, Oil Search rose 5? to $7.1 and Santos was 10? firmer at $14.45.At the close of Australian trade, the spot gold price was down $US11.83 at $US1678.50 an ounce.