THE sharemarket jumped to its highest close in more than five months yesterday, after global markets rallied in the wake of a successful bond auction by economically troubled Spain.
Investors were also buoyed by a reasonably positive production report from global miner BHP Billiton.
The S&P/ASX 200 Index rose 59.9 points, or 1.4 per cent, to 4348.7, its best close since October 28.
Global sharemarkets rallied in response to the Spanish short-term bond auction, which eased concerns over the eurozone debt crisis. Spanish yields are the hot topic in the market at the moment, with daily investment flows either towards or away from riskier assets hinging on the price direction of the embattled country's bonds.
The overnight auction of short-term bonds was a curtain raiser to a crucial auction of 10-year bonds later this week, seen as a key indicator of the market's confidence in Spain.
CMC Markets chief market analyst Ric Spooner said the Australian market responded positively to the auction, but noted that short-term bonds were less risky than the long-term bonds
up for sale later this week.
"But so far, so good," Mr Spooner said. "A generally
in-line and reasonable result from BHP Billiton gave us some support today as well, all against the background of a presumption of an interest rate cut by the Reserve Bank next month."
In the resource sector, BHP Billiton rose 95?, or
2.9 per cent, to $35.10 after its latest production figures met expectations. But the miner warned that the impact of ongoing strikes at its Queensland coal mines might be substantial.
Rio Tinto jumped $1.80, or 2.8 per cent, to $66.50 while Fortescue rose 14?, or 2.4 per cent, to $5.93 ahead of its production report today.
Oil and gas producer Petsec Energy was steady
at 18.5? as it booked a 62 per cent plunge in March-quarter revenue after falls in production and US gas prices.
Westfield Group gained 30? to $9.17 after it said it would sell eight shopping centres in the US for
$US1.15 billion so it could reduce debt and invest in developments such as the new World Trade Centre.
Bank of Queensland was 18? higher at $7.14 after it said loan arrears were stabilising. A big rise in the cost of bad loans caused a $90.6 million first-half loss for BOQ.
NAB rose 33? (1.5 per cent) to $25.18, Westpac advanced 8? to $22.06,
ANZ picked up 26? (1.1 per cent) to $23.26 and Commonwealth put on 68? (1.4 per cent) to $50.78.
The dollar gained three-quarters of a US cent, closing at $US1.0385 from Tuesday's $US1.0314.
Frequently Asked Questions about this Article…
What drove the ASX to its highest close in more than five months?
The S&P/ASX 200 jumped 59.9 points (about 1.4%) to 4348.7 after global markets rallied. The lift followed a successful Spanish short‑term bond auction that eased eurozone debt worries and a reasonably positive production report from BHP Billiton, alongside expectations of a possible Reserve Bank interest rate cut next month.
How did Spain’s bond auction affect global markets and Australian investors?
A successful auction of short‑term Spanish bonds eased concerns about the eurozone debt crisis and sparked a global sharemarket rally. The result boosted investor risk appetite in Australia ahead of a more important 10‑year Spanish bond auction later in the week, with Spanish yields influencing flows into or away from riskier assets.
What did BHP Billiton’s production report mean for investors and its share price?
BHP Billiton’s production figures met expectations, helping support the market. BHP shares rose about 2.9% to $35.10, but the company warned that ongoing strikes at its Queensland coal mines could have a substantial impact—an operational risk investors should note.
How did other major miners like Rio Tinto and Fortescue perform?
Rio Tinto jumped $1.80 (around 2.8%) to $66.50, while Fortescue rose about 2.4% to $5.93 ahead of its production report. The moves show miner share prices were buoyed by the positive market tone and company‑specific news around production.
What happened to Petsec Energy and why did its revenue fall?
Oil and gas producer Petsec Energy was steady at about 18.5 cents after reporting a 62% plunge in March‑quarter revenue. The decline was attributed to lower production and weaker US gas prices.
Why did Westfield Group shares rise and what assets did it plan to sell?
Westfield Group gained to $9.17 after announcing plans to sell eight US shopping centres for about US$1.15 billion. The company said proceeds would be used to reduce debt and invest in developments such as the new World Trade Center.
What was the banking sector news, including Bank of Queensland and the big four banks?
Bank of Queensland rose to $7.14 after saying loan arrears were stabilising, despite a $90.6 million first‑half loss driven by higher bad‑loan costs. Major banks also advanced: NAB rose to $25.18, Westpac to $22.06, ANZ to $23.26 and Commonwealth Bank to $50.78, reflecting the broader market uplift.
How did the Australian dollar move and what was the closing rate?
The Australian dollar gained three‑quarters of a US cent, closing at US$1.0385, up from US$1.0314 on Tuesday.
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