Solid finish after banks get a bounce
THE sharemarket finished firmer as investors sought high-yielding bank stocks following Tuesday's cut in the cash rate.
THE sharemarket finished firmer as investors sought high-yielding bank stocks following Tuesday's cut in the cash rate.At the close, the benchmark S&P/ASX 200 Index was up 16.8 points, or 0.37 per cent, at 4520.4.RBS Morgans private client adviser Bruce Smith said the market improved, thanks to the banking sector, which closed about 1 per cent higher. "Our market was dragged up by the banks, Suncorp and the likes of Rio Tinto," Mr Smith said. "It follows [Tuesday's] rate cut, as people look to high-yielding banking stocks."Traders paid little attention to national accounts data showing Australia's economy grew by 0.5 per cent in the September quarter, which was slightly below expectations.Commonwealth Bank, Westpac and NAB on Wednesday passed on only 20 basis points of the full 25-basis-point RBA cut to the cash rate. ANZ will announce its interest rate decision on December 14.Commonwealth Bank shares climbed 58? to $61.08, Westpac was up 16? at $25.58, National Australia Bank put on 6? to $24.31 and ANZ added 18? to $24.77. Bancassurer Suncorp finished 23? higher at $9.97.BHP Billiton added 3? to $34.29 and Rio Tinto rose 94? to 59.35.The good news for Rio came after freight rail operator Aurizon, formerly known as QR National, extended a Queensland coal haulage contract.Aurizon, which was up 6? at $3.63, will transport up to 12 million tonnes of coal a year from Rio Tinto's Clermont mine to the Dalrymple Bay coal terminal in Queensland for 10 years from next July.Ten Network shares have gone into a trading halt - having last traded at 32.5? - as the struggling free-to-air television broadcaster prepared to raise new funds.Sundance Resources shares fell 11.5 per cent, or 4.5?, to 34.5? after suitor Hanlong Mining delayed a takeover deal this week.National turnover was 1.89 billion securities worth $3.6 billion.The dollar was trading higher at $US104.74?, up from $US104.38?.Meanwhile, bond futures prices were steady after national accounts data showed economic growth had slowed.JPMorgan interest rate strategist Sally Auld said the market was waiting for developments in negotiations between US politicians trying to avoid the fiscal cliff of tax rises and spending cuts due to apply automatically next year."I think everyone's focus is really on the fiscal cliff and the probability of whether that gets resolved or not as we head towards Christmas," she said.The December 10-year bond futures contract was at 96.900, and the three-year contract was at 97.380, both unchanged.