Stocks edge up but volumes well down
THE stockmarket yesterday rose to its highest close since early May, lifted by the miners, as a recent recovery in commodity prices and a flurry of central bank stimulus fuelled hopes for stronger global growth and demand.
THE stockmarket yesterday rose to its highest close since early May, lifted by the miners, as a recent recovery in commodity prices and a flurry of central bank stimulus fuelled hopes for stronger global growth and demand.The benchmark S&P/ASX200 Index rose 12.5 points, or 0.3 per cent, to 4402.5, while the broader All Ordinaries gained 11.6 points, or 0.3 per cent, to 4421.8.The materials sector led the move, rising 1.9 per cent, and goldminers rose 2.2 per cent. Consumer staples and discretionary fell 0.6 and 0.4 per cent respectively, while industrials lost 0.6 per cent.Meanwhile, the Australian dollar consolidated its gains from last week, trading around US105.4? Over the weekend, it jumped past the US106? mark, its highest point in six months.Investors continued to dive into mining stocks on the back of the US Federal Reserve's third round of quantitative easing to stimulate the fledgling US economy."It's probably a two-part story, not only is there a confidence boost from the quantitative easing from the Europeans and the Americans, but also the fact we've seen commodity prices rise in the last week or so," said Darryl Conroy, market analyst at Suncorp Banking."Specifically metals have performed very well. Of course, iron ore, popping back over $US100 a tonne, has probably given our mining sector a much needed confidence boost as well," Mr Conroy said.BHP rose 84?, or 2.5 per cent, to $34.15, while Rio Tinto added 92?, or 1.6 per cent, to $57.50, Iluka Resources jumped $1.06, or 10.2 per cent, to $4.35.Investors are keenly awaiting an announcement from Fortescue Metals about the restructuring of its debt. The troubled miner entered a trading halt on Friday after spiralling more than 14 per cent on Thursday last week.Australia's largest goldminer, Newcrest Mining continued its upward push, adding 76?, or 2.7 per cent, to $29.12.Gold traded around six-month highs, at around $US1770 an ounce.All the big banks posted gains, with Westpac leading the charge, rising 31?, or 1.3 per cent, to $24.42, ANZ added 16?, or 0.7 per cent, to $24.39, NAB increased 7?, or 0.28 per cent and CBA remain flat, adding 1? to finish at $55.29.Retailers dragged on the market, department store David Jones lost 7?, or 3 per cent, to $2.23, rival Myer fell 2?, or 1.1 per cent, to $1.83.Woolworths dropped 30?, or 1 per cent, to $28.56, while Wesfarmers finished relatively flat, down 2? , to $24.53.Mr Conroy said yesterday's gains should be taken with a "grain of salt", as volumes remained low, indicating investor caution.Average trading volume for the ASX200 is 820 million shares traded, while on the day, volume was below 680 million."One thing that is probably certain: more volatility to come," Mr Conroy said.