PERTH: The Australian sharemarket closed largely flat after seesawing around the release of better-than-expected Chinese economic growth figures, as a minor rally in the banks failed to offset weaker mining stocks.
At the 4.15pm (AEDT) official market close, the benchmark S&P/ASX200 was up 1.5 points, or 0.03 per cent, at 5269.7, while the broader All Ordinaries had gained 0.8 points, or 0.02 per cent, to 5304.5.
The local market gained ground out of the starting blocks, as Westpac exited a trading halt following its interest rate hike and $1.6 billion capital raising, but soon turned sour ahead of the release of China’s GDP data.
Official figures, which are widely questioned, recorded China’s GDP growth rate at a six-year low of 6.9 per cent in the year through September, ahead of economist expectations of 6.8 per cent.
Despite the better-than-expected numbers, Westpac said it remained of the view that China’s economy “still requires easier financial and fiscal conditions, which will be delivered in due course”.
Asian sharemarkets and currencies across the region saw a strong surge on the data, but the response on the local exchange was fairly muted as the index slowly crawled back to where it started the day.
However, the Australian dollar bounced back from the weekend’s decline and tacked on almost half a US cent, climbing to the US72.75c level following the figures.
CommSec economist Savanth Sebastian said the shifts in China’s economy were, in effect, similar to the changes in Australia.
“Heavy manufacturing and investment have been pulling back over the past year but it is being offset by a lift in domestic consumption,” Mr Sebastian said.
“Some investors might focus on the annual growth rate holding at a six-year low,” he said. However it is important to realise that the Chinese economy will grow at a slower pace in coming years as the economy gets bigger and matures.”
