Australian Stock Market Report - Closing
Local stocks rallied today, reaching one month highs, as investors reacted favourably to the Reserve Bank’s decision to keep interest rates on hold at 4.75pct. The All Ordinaries Index (XAO) gained 36.6pts or 0.8pct to 4816 while the S&P/ASX 200 Index (XJO) firmed by 38.2pts or 0.8pct to 4726.8.
Chinese share markets however slumped following reports the country’s central bank may raise rates this week, ahead of the release of November inflation data on Monday.
Banking stocks all posted solid gains with shares in the NAB (NAB), the best out of the big four. NAB shares rose 1pct to $23.96 while Westpac (WBC) was up 1.2pct to $21.94 and the Commonwealth Bank (CBA) gained 1pct to $49.76. Shares in the ANZ (ANZ) increased by 1pct to $23.49 while Macquarie Group (MQG) was firmer by 0.3pct to $35.73.
Mining stocks were boosted by firmer commodity prices across the board. Shares in BHP Billiton (BHP) gained 1.2pct to $45.08 while Rio Tinto (RIO) was firmer by 1.6pct to $87.34. Shares in iron ore miner Fortescue Metals Group (FMG) gained 0.6pct to $6.56. Australia’s largest gold miner Newcrest (NCM) added 1pct to $41.50 as the price of gold hit fresh record highs. At 4pm AEDT the Comex contract was up 0.4pct to US$1422.10 an ounce.
In the energy sector, Caltex (CTX) shares shot up 2.7pct to $14.50.
Fairfax (FXJ) shares recovered from yesterday’s sharp sell-off, which was a kneejerk reaction to news the company’s CEO Brian McCarthy had resigned. FXJ today rose 2.5pct to $1.44.
Telstra (TLS) lost 0.4pct to $2.79.
Property developer Stockland Group (SGP) rose 0.8pct to $3.70 after announcing it has secured the right to a $4 billion block of land in Melbourne, marking the property trust´s biggest ever land deal.
Some healthcare stocks remained under pressure however, after US drug giant Pfizer announced changes to the way it distributes drugs in Australia. Wholesaler Sigma Pharmaceuticals (SIP), which is expected to suffer under the changes, received a broker downgrade and closed steady at $0.405 while Australian Pharmaceutical Industries (API) fell 7.8pct to $0.42.
QR National (QRN) announced today that all its rail lines affected by flooding and heavy rain across the East Coast have been re-opened, and the company doesn’t expect any impact to earnings. QRN gained 0.8pct to $2.70.
The Reserve Bank of Australia today met for the last time in 2010 and decided to leave the cash rate at 4.75pct. The next meeting is on February 1 2011.
The Reserve Bank Board noted that lending rates are now a little above average and believes that this tight policy is “appropriate for the economic outlook.”
The Australian dollar ended the day’s trade at US99.12c, £0.6293 and €74.3c.
On the market overall, a total of 2.58 billion shares were traded, worth $5.4 billion. 575 were up, 520 were down and 414 were unchanged.
At 4.30pm AEDT on the ASX24, the futures contract was at 4733, up 34pts.
Ahead tonight, weekly data on chain store sales is released in the US.