Telstra the pick as market rebounds
THE sharemarket closed higher yesterday, buoyed by hopes that political leaders in the United States can negotiate a compromise over the looming "fiscal cliff".
THE sharemarket closed higher yesterday, buoyed by hopes that political leaders in the United States can negotiate a compromise over the looming "fiscal cliff".The benchmark S&P/ASX 200 Index added 24.6 points, or 0.6 per cent, to 4361.4, while the broader All Ordinaries gained 22.5 points, or 0.5 per cent, to 4382.6.The US "fiscal cliff" has been worrying investors for the past few weeks and a meeting of Democrat and Republican leaders on Friday raised hopes an agreement could be reached before automatic tax increases and spending cuts come into effect on January 1.All sectors on the ASX finished higher, with energy up 2.3 per cent, telecoms, gold and health all rising 1.2 per cent, and materials up 0.6 per cent.Telstra rose to its highest close in more than four years, adding 1.2 per cent to finish at $4.17."The US 'fiscal cliff' has been weighing on investor sentiment for a few weeks, [and now] the Israel-Hamas conflict.That's prompting a lot of allocation into defensive names. In this sort of environment you typically see rotation into safe haven stocks, and Telstra would certainly apply," said BBY institutional dealer Anson Rosewall.The big miners were mixed. BHP Billiton jumped nearly 1 per cent to $33.21, while Rio Tinto slipped 0.3 per cent to $56.71. Fortescue dropped 1.3 per cent to $3.85.Oil and gas producer Santos enjoyed a nice push up after it announced a large discovery of gas off the coast of Western Australia's Kimberley region. Its shares closed up 3.9 per cent at $11.30.Struggling surfwear retailer Billabong finally found some good news for investors. Paul Naude, the director of its US operations, advised the board that he would be holding talks with possible financiers ahead of a possible leveraged buyout of the company."The fundamentals of the business are still struggling," said Mr Rosewall. "While it's good news for the stock, it's a question of how they are going to finance it until we get a bit more clarity about that, investors will still be cautious."Billabong shares surged 10.1 per cent to 81.5?.Among the banks, ANZ and Westpac traded relatively flat at $23.56 and $24.40 respectively, while CBA slipped 0.2 per cent to $58.15 and NAB rose 0.7 per cent to $23.36.US markets will be closed on Thursday and for half a day on Friday for Thanksgiving, which will probably mean a quiet week.Meanwhile, the dollar closed higher after hitting seven-month highs against the yen during local trading. Late on Monday, the Aussie was trading at US103.67?, up from Friday's close of US103.21?. It rose to Y84.48 against the Japanese yen.