CANBERRA: The Australian sharemarket closed higher on Thursday as big banks and miners improved following strong leads from Wall Street. At the 4.15pm (AEDT) official market close, the benchmark S & P/ASX200 index was up 72.5 points, or 1.45 per cent to 5082.2, while the broader All Ordinaries index added 70.3 points, or 1.38 per cent, to 5151.8.
The finish puts the benchmark up 4.1 per cent for March, its first monthly increase for the year. But the index finished a tad over 4 per cent in the red for the quarter. The bourse was higher from the open after Wall Street gained ahead of the Australian session amid receding worries of near-term US interest rate hikes.
Analysts said jobs data out of the US had lifted trans-Atlantic sentiment, which had been also buoyed 24 hours previously by dovish comments from US Federal Reserve chair Janet Yellen. “With central banks fighting for weaker domestic currencies to stimulate growth and inflation, there appears to be no urgency for the Fed to continue its policy tightening path,” EasyMarketsDealer James Humpherson said.
Major major miners BHP Billiton and Rio Tinto jumped out of the blocks following strong gains in their London listings overnight, lifting 3 per cent in the morning trade before paring gains across the afternoon as oil futures headed south. Ahead of the open, global oil prices had been largely unchanged while iron ore had slipped. BHP Billiton finished 1.44 per cent higher to $16.86, while Rio Tinto rose 1.67 per cent to $42.69. Materials stocks added 0.9 per cent overall.
After a slower start, the big banks joined the rally, NAB leading the way with a 2.34 per cent improvement as the financials sector jumped 1.8 per cent. ANZ was up 1.51 per cent to $23.46, while Commonwealth Bank advanced 2.2 per cent to $74.92. Westpac improved 1.54 per cent to $30.35.
Some economic releases saw a slight tapering in the benchmark late morning, as the Housing Industry Association recorded a sharp 5.3 per cent decline in new home sales across February, although the Australian Bureau of Statistics found a 2.7 per cent rise in job vacancies in the month. Meanwhile, the Reserve Bank’s private sector credit measure lifted slightly more than economist predictions in February.
On the currency front, the Australian dollar was trading slightly lower than the nine-month high US77.1c posted overnight on the Fed developments, but was still tracking higher than US76.5c. Meanwhile, overseas, Bank of Japan governor Haruhiko Kuroda told a parliamentary session the central bank had room to pursue further monetary easing, saying there was no “quantitative limit”.
In equities news back at home, US-based Iron Mountain’s $2.6 billion takeover of documents manager Recall Holdings looks set to go ahead after the consumer watchdog said an undertaking to divest the bulk of the Australian business would appease competition concerns. Recall lifted 1.9 per cent to $7.50.
Qantas Airways closed 2.52 per cent higher to $4.07 as it revealed it had boosted capacity by 9.5 per cent in February from a year ago after adding services to the US and Asia.
Infrastructure group Duet — which was in a trading halt — announced a $205 million deal to buy Alcoa’s Dampier Bunbury pipeline, while Origin Energy signed a 15-year contract with a 54 megawatt Moree solar farm. Origin Energy gained 3.04 per cent to $5.09 as energy stocks lifted 1.2 per cent. Woodside Petroleum and Santos were both flat, at $25.96 and $4.03 respectively, while Oil Search lifted 0.6 per cent to $6.76.
Elsewhere in trading, consumer staples rose 0.9 per cent as Wesfarmers improved 0.44 per cent to $41.45 and Woolworths lifted 1.05 per cent to $22.10. Looking ahead, the influential Chicago purchasing managers index is released in the US overnight while, back at home, the Australian Industry Group has its manufacturing activity gauge tomorrow while CoreLogic and RP Data release the March reading on home prices.
