World Market Overview 06/13/2011
The Australian share market staged a modest relief rally on Friday on a positive Wall Street lead, with bargain hunters and short-sellers pushing resources higher. The benchmark S&P/ASX200 index was up 12.5 points at 4,562.1, while the broader All Ordinaries index was 13.2 points higher at 4,634.9. On the ASX 24, the June share price index futures contract was 14 points higher at 4,568, with 50,107 contracts traded.
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US stocks were lifted by an unexpected narrowing of the US trade deficit in April, with the Dow Jones Industrial Average gaining 0.63 per cent to end six straight sessions of losses. Preliminary national turnover reached 1.96 billion shares, worth $4.1 billion, with 555 stocks trading up, 501 down and 419 unchanged.
Market heavyweight BHP Billiton firmed 20 cents, or 0.47 per cent, to $43.15, while Rio Tinto gained 41 cents, or 0.51 per cent, to $80.20. Oil Search led the oil sector higher by surging 19 cents, or 2.87 per cent, to $6.81, while rivals Woodside Petroleum and Santos both lost around 0.36 per cent. Gold majors Newcrest Mining and Kingsgate Consolidated moved 0.13 per cent and 1.23 per cent higher respectively, as the price of gold climbed. The spot price of gold in Sydney was trading at $1,540.50 per fine ounce, up $4.22 from Thursday's closing price of $1,536.28. Major banks were mixed, with Westpac gaining six cents to $21.85, ANZ Banking Group adding three cents to $21.53, Commonwealth Bank easing one cent to $49.59 and National Australia Bank falling 11 cents to $24.17.
Consumer discretionary stocks made solid gains after suffering heavy losses earlier this week. Department store owner Myer Holdings jumped eight cents, or 2.93 per cent, to $2.81, David Jones gained eight cents or 1.99 per cent to $4.10, and Billabong increased 12 cents, or 1.97 per cent, to $6.20. Stockland dropped five cents, or 1.44 per cent, to $3.42, and Goodman Group fell 0.5 cents to 73.5 cents. In news on Friday, Gloucester Coal said it will offer over a million new shares to investors in a bookbuild, following a shortfall in a retail capital raising. Its shares rallied 20 cents, or 2.5 per cent, to $8.19. Uranium miner Paladin sought to dampen market rumours about the company's financing arrangements, a potential capital raising and a potential sale by Newmont Mining of its 6.71 per cent stake in Paladin. Paladin's shares jumped eight cents, or 2.95 per cent, to $2.79.
The Australian dollar pared back New York session strength in Asian trade as traders reduced exposure to risk assets such as the local currency in thin trading. The move lower in Asian trading came despite an improved May trade surplus in China and a gain Thursday for U.S. stocks. Continued concerns about the global economic outlook have galvanized traders against pushing too hard into some of the more risk sensitive assets, while local factors continue to weigh on the Australian dollar. Among the most concerning for Australian dollar bulls is the continued weight of weak jobs figures released Thursday. The Australian dollar was trading at $1.0600, up slightly from $1.0588 late Thursday. Against the Japanese yen, the Australian dollar was at 84.925, up from 84.83.
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