RTTNews - The Australian stock market opened on a bright note Wednesday, with investors tracking overnight Wall Street cues and going on a buying spree in early trading. Energy, consumer staples, healthcare, industrials, materials and utilities stocks are trading sharply higher. Telecommunications and technology issues are exhibiting a mixed trend while financials are trading weak.
The benchmark S&P/ASX 200 index, which rose to 3,826 after opening slightly below 3,800, is currently trading at 3,818.30, up 29.90 points over its previous close. The All Ordinaries index is up 30 points at 3,811.60.
The S&P/ASX 200 index had closed up 50.50 points at 3,788 on Tuesday and the All Ordinaries had moved up 46.30 points to settle at 3,782.
Materials stocks BHP Billiton, Orica and Rio Tinto are trading firm with notable gains. In the energy space, AGL Energy and Woodside Petroleum are trading firm.
Capital goods issue Leighton Holdings is up 1.7%. Media stock News Corp. is trading nearly 3.5% up.
Caltex, Australia's largest refinery, will buy ExxonMobil Corp's petrol service stations in Australia for about A$300 million, or US$233.6 million. The two firms have agreed on the sale of Exxon's retail fuels business, comprising 302 service stations mostly located along Australia's populous east coast.
Caltex said the acquisition cost includes estimates for inventories and other settlement costs, and added that it would take on more than 1,700 staff under this deal. The Caltex stock is trading firm with a sharp 3.4% gain.
In other corporate news, Suncorp Metway said it lost another A$136 million in impairments in the quarter to the end of March, taking the company's impaired assets to A$1.2 billion. But Suncorp said its capital position had strengthened during the period, with its capital adequacy ratio rising to 13.24 per cent, and its Tier 1 ratio increasing to 11.39 per cent. The stock is trading 5.2% down from its previous close.
Meanwhile, ANZ Bank seeks to raise A$2.5 billion in new capital through a share placement with institutional investors. The bank will offer the shares at A$14.40, lower than the stock's closing price of A$15.57 in the previous session. ANZ shares have been placed in a trading halt with trading expected to resume on Thursday morning.
ANZ announced the capital raising as it said the banking outlook remains uncertain and difficult to predict. The bank plans to use the proceeds of the share placement to create greater financial flexibility to pursue strategic and organic growth opportunities and to further strengthen the Group's capital position.
In the currency market, the Australian dollar rose to an eight-month high this morning as buoyant U.S. consumer confidence data stirred hopes the global economy was near a bottom and lifted demand for high-yielding currencies. Currently, the Australian dollar is trading at 0.7862 to the U.S. dollar.
Among other markets in the Asia-Pacific region, New Zealand, Korea and Japan are trading higher. While the Nikkei average of the Japanese market is up 1.57%, New Zealand's NZX 50 and Korea's KOSPI are trading higher by a little over 1%.
Wall Street came back strongly after a long weekend on Tuesday with healthy consumer data raising hopes of an economic rebound. The Conference Board's reading on consumer confidence for May reached its highest level since September 2008, generating some optimism about the outlook for consumer spending.
Disappointing housing price data had pushed down stock prices earlier in the session. The major averages moved roughly sideways in the second half of the day, holding onto strong gains. The Dow closed up 196.17 points or 2.4 percent at 8,473.49, the Nasdaq rose 58.42 points or 3.5 percent to 1,750.43 and the S&P 500 closed up 23.33 points or 2.6 percent at 910.33.
The stock markets in Asia had finished mostly lower on Tuesday. Japan's benchmark Nikkei 225 Index slipped by 0.4 percent and Hong Kong's Hang Seng Index fell 0.8 percent.
Major European markets closed notably higher after seeing some earlier weakness. The U.K.'s FTSE 100 Index closed up 1.1 percent, while the French CAC 40 Index and the German DAX are finished up by 1.1 percent and 1.3 percent, respectively.
On Tuesday, oil prices climbed to a new six-month high as traders viewed a jump in U.S. consumer confidence as a signal for an economic rebound and increased energy demand. New York's main futures contract, light sweet crude for delivery in July, rose 78 cents from the closing price on Friday to end at US$62.45, the highest close since November 5. The intraday price shot up to US$62.50.
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