SYDNEY: The Australian sharemarket has closed substantially higher, as the weakening Australian dollar lifts resources stocks amid a flurry of mergers and acquisitions.
At the 4.15pm (AEST) official market close, the benchmark S&P/ASX200 index was up 56.8 points, or 1 per cent, at 5,721.5, while the broader All Ordinaries index was up 51.7 points, or 0.91 per cent, at 5,719.9.
The local market bounced higher off the back of a lower Australian dollar, which weakened after strong US inflation data raised the prospect of a US rate hike in the coming months.
The local currency hit the low US78c range in early trade, buoying the energy and mining sectors as merger and acquisition activity boosted sentiment across the broader market.
Sirius Resources lifted 20.37 per cent to $3.90 after Independence Group lobbed a $1.8 billion takeover bid for the group. Independence shares were 11.97 per cent lower at $5.15.
Skilled shares shot up 11.79 per cent to $1.375 after announcing it had resumed talks with Programmed regarding an acquisition. Programmed shares lost 4.2 per cent to $2.51.
IG market strategist Stan Shamu said there was region-wide positive sentiment helped by renewed weakness in the Australian dollar, lifting even the recently-beaten banking stocks.
“Despite all the talk about diminishing payback ratios for the banks, investor confidence has been fairly strong today,” Mr Shamu said.
