Stocks keep up rally after commodity lift
THE Australian market moved up strongly yesterday as investors focused on Italy and a rise in commodity prices.
THE Australian market moved up strongly yesterday as investors focused on Italy and a rise in commodity prices.The S&P/ASX 200 Index climbed 52.3 points, or1.22 per cent, to 4346.1. The benchmark has climbed 174.3 points in the past four sessions and has now recovered all but 2 points of the ground lost in a week-long tumble from its close on October 27 at 4348.2.The materials sector led gains after further advances on Wall Street and stronger metals prices overnight.US stocks rose on news that Italian Prime Minister Silvio Berlusconi would resign once a new budget was passed. Italy has become a key focus for markets this week, with Mr Berlusconi seen as an obstacle to sweeping economic reforms needed to help the country cut its debt load and avoid sinking into a debt crisis.IG Markets analyst Stan Shamu said Australian stocks had opened strongly, in line with Wall Street."Reports suggest Silvio Berlusconi is on his way out and markets seem to have taken kindly to that news," Mr Shamu said.The general theme of risk taking had continued, with the materials sector rising1.7 per cent, he said.BHP Billiton shares put on 58?, or 1.5 per cent, to $38.33 and Rio Tinto rose 98? to $70.75.Fortescue Metals moved up 8?, or 1.6 per cent, to $5.10. An Aboriginal corporation has been denied the opportunity to speak at Fortescue Metals Group's annual meeting.Myer was among the day's best performers as the consumer discretionary sector posted solid gains. It jumped 15?, or 6.4 per cent, to $2.48 after the company reiterated its guidance for flat sales for the full financial year but reported early signs that Christmas spending would be better than expected.Other retailers were also higher, with David Jones up 15? at $3.29 and Harvey Norman 7? higher at $2.19.Seven Group Holdings rose 20?, or 2.6 per cent, to $7.78 after the resources and media company said it expected its first-half profit to be higher than for the same period last year.Goldminer Newcrest jumped 81?, or 2.3 per cent, to $36.87. At the close of Australian trade, the spot gold price was down $US4.39 at $US1788.24 an ounce.The dollar closed higher as the looming resignation of Italy's prime minister improved investor sentiment. However, gains from the overnight session overseas were given back in Australian trading as the currency failed to break through the $US1.04. At the close it was at $US1.0362, up from Tuesday's $US1.0307.