June 13, 2011 7:05 AM EDT
The evil spell that was cast on the sharemarket over the past week and half has been lifted for the time being, with the ASX 200 index (XJO) rising 0.3 pct or 12.5 pts to 4562.1 while the broader All Ordinaries index (XAO) jumped 0.3 pct or 13.2 pts to 4634.9.
Almost all sectors ended higher today. By Wednesday this week we had endured the biggest losing streak in 12 months for the Australian sharemarket after stocks fell for 6 consecutive days. Thankfully, shares ended higher yesterday and today which resulted in only a modest 0.6 pct pullback over the past 5 days.
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The volume and value of shares traded today remained light ahead of the long weekend in NSW however.
One of Australia's largest uranium producers, Paladin Energy (PDN) rose 2.95 pct or 8 cents to $2.79 today after announcing to the market that it is not considering raising additional capital. In PDN's official statement to the market it clarified that its expansion is going to plan, its debt is in good standing, the company is not planning to raise capital and that Australia's largest gold producer, Newcrest Mining (NCM) is planning on retaining its stake in the uranium company. PDN has a market capitalisation of $2.1 billion.
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The S&P/ASX 200 Financials index managed to end higher by only 0.06 pct or 2.5 pts to 4217.0 today. Westpac (WBC) rose 0.28 pct or 6 cents to $21.85 and ANZ Banking Group (ANZ) gained 0.14 pct or 3 cents to $21.53. National Australia Bank (NAB) fell 0.45 pct or 11 cents to $24.17 and the country's largest lender Commonwealth Bank of Australia (CBA) ended 1 cent lower.
The S&P/ASX 200 Materials index jumped 0.47 pct or 62.6 pts to 13298.0. Australia's largest miner BHP Billiton (BHP) gained 0.47 pct or 20 cents to $43.15 and the smaller RIO Tinto (RIO) gained 0.51 pct or 41 cents to $80.20.
The retailers had a great day, with department store owner, Myer (MYR) rising 2.93 pct or 8 cents to $2.81 while its competitor David Jones (DJS) gained 1.99 pct or 8 cents to $4.10.
As usual, there was a lack of economic data released on Friday in Australia; however the Department of the Treasury released the draft Bill for the Mineral Resource Rent Tax (MRRT) today.
The Australian Government is expected to apply the amendments to mining taxation from July 2012. A MRRT will apply to the mining of iron ore and coal in Australia. Smaller miners with MRRT assessable earnings of under $50 million a year will be excluded from the tax. The tax rate will be 30 pct. The MRRT will also provide a credit for state royalties paid in respect of a mining project.
According to the Treasury, "The community, through the Australian and State governments, own the rights to these resources and we have a responsibility to future generations to charge appropriately for using them. The new resource taxation framework will enable the nation to make the most of the resources boom, invest in infrastructure and jobs and give all Australians a lasting stake in our prosperity."
In Asia today, Japan's Nikkei 225 index was the best in the region after gaining 0.5 pct or 47.29 pts to 9514.44. South Korea's KOSPI index was down 1.19 pct or 24.75 pts to 2046.67, China's Shanghai Composite index dropped 0.23 pct or 6.18 pts to 2697.16 and Hong Kong's Hang Seng dropped 0.83 pct or 188.48 pts to 22421.35.
China's trade balance was out today for the month of May. This measures the difference between imported and exported goods. Despite posting a healthy surplus of around US$13 billion, it still missed expectations of an approximate US$19.5 billion.
Economic data out of Japan was lower than expectations today, with both the Corporate Goods Price Index (CGPI) and a report measuring the change in the total value of services purchased by business ending a little under forecasts.
South Korea's central bank decided to increase its interest rates for the first time in 4 months by 25 bps to 3.25 pct. In its monthly statement, The Bank of Korea said that it "...considers the recoveries in major advanced economies to have exhibited signs of being somewhat delayed, while emerging market economies continue to show favorable performances. Going forward, the Committee forecasts that the global economy will keep up its pace of recovery; nevertheless, the Committee recognizes the possibility of such factors as the sovereign debt concerns in some euro area countries, the political unrest in North Africa and the Middle East, and the impacts of the Great East Japan Earthquake posing downside risks to the global economy".
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