AFTERNOON REPORT
(4.30pm AEST)

An estimated $23 billion in value was added to the local share market today. Stocks rallied on hopes Washington would reach an agreement to raise the US debt ceiling before the August second deadline. A debt ceiling is the name given to the maximum borrowing power of a government, and overnight US President Obama expressed optimism that a deal to raise that borrowing power would soon be reached. Strong company earnings results released in the US overnight also boosted local investor sentiment, on hopes corporate America is back on track. The All Ordinaries Index (XAO) today rose 79pts or 1.7pct to 4618.4 while the S&P/ASX 200 Index (XJO) gained 81.6pts or 1.8pct to 4549.7.

The financial sector rose 2.1pct. In Europe overnight, the STOXX Europe 600 Banks Index rose by 1.4pct on hopes European leaders will be successful in agreeing on a bail-out deal for Greece. Shares in Westpac (WBC) added 2.3pct to $21.16 while the Commonwealth Bank (CBA) was up 2.1pct to $49.55 and the NAB (NAB) firmed by 2.6pct to $24.29. Shares in the ANZ (ANZ) gained 2.1pct to $21.20 while Macquarie Group (MQG) was up another 1.6pct to $28.51.

BHP Billiton (BHP) reported June quarter production figures, largely in line with expectations. Iron ore production rose 7pct, while coking coal production continued to recover from the Queensland floods, rising 19pct. Petroleum production was lower than expected, with continued slow progress on new drilling in the Gulf of Mexico. BHP also announced a significant resource upgrade to its Escondida operation in Chile. BHP shares rose 1.9pct to $43.44 while Rio Tinto (RIO) gained 1.5pct to $82.55.

NewsCorp (NWS) shares rose 5.5pct in New York trade overnight as Chairman and CEO Rupert Murdoch testified before a UK parliamentary inquiry into the News of the World phone hacking scandal. On the local market, NWS rose 5.1pct to $15.24, continuing to recover from Monday's two year low of $14.17.

Woolworths (WOW) reported a 4.7pct lift in FY sales to $54.1 billion. The company has hailed the result as an achievement due to what it called a very challenging year. WOW shares added 0.7pct to $27.45.

Overnight in the US, there was a strong surge in June housing starts. Building materials company James Hardie (JHX) rose 1.8pct to $5.80 on the local market.

Port and rail operator Asciano Group (AIO) gained 4.6pct to $1.695 after securing a new five year container contract with Danish shipping giant Maersk Line.

MAP Group (MAP) shares added 1.5pct to $3.44 as the company signed an agreement which will see it focus predominantly on Sydney Airport.

The Australian dollar ended the day's trade at US107.32c, £0.6657 and €75.71c.

On the market overall, a total of 2.6 billion shares were traded, worth $5.2 billion. 783 were up, 324 were down and 342 were unchanged.

At 4.30pm AEST on the ASX24, the futures contract was at 4525, up 84pts.

Ahead tonight, data on existing home sales is released in the US. After the bell, American Express and chipmaker Intel release quarterly results.

(From Juliette Saly, CommSec Market Analyst)