RTTNews - The Australian market ended in positive territory on Wednesday, led by mining and infrastructure stocks on optimism that the worst for the economy might be over. A positive closing on Wall Street and better-than-expected results from Intel also lifted market sentiment.
In the U.S., stocks ended in positive territory, led by some late buying activity, meandering back and forth across the unchanged line for most of the session. While the economic numbers were better than expected, the quality of growth raised apprehensions, more than offsetting the positive sentiment generated by better-than-expected results from Goldman Sachs (GS) and Johnson & Johnson (JNJ).
A report released by the Commerce Department revealed that retail sales increased by a little more than expected in June, although the sales growth was due in large part to higher gasoline prices. The report showed that retail sales rose 0.6% in June following an unrevised 0.5% increase in May. Economists had been expecting retail sales to increase by a modest 0.4%. Excluding increases in gas station and motor vehicle and parts sales, retail sales actually fell 0.2 percent for the month.
The U.S. Labor Department revealed that producer prices, a key measure of wholesale inflation, rose 1.8% in June, following a 0.2% increase in the previous month. Core producer prices, which exclude food and energy prices, climbed 0.5%.
Rail-road stocks, gold, oil service, natural gas, semiconductor and airline stocks posted gains, while the healthcare sector continued to be the laggard.
The Dow closed up by 27.81 points or 0.3% at 8,359, the Nasdaq advanced by 6.52 points or 0.4% to 1,800 and the S&P 500 rose by 4.79 points or 0.5% to 906.
The All Ordinaries Index opened slightly higher at 3,863 compared to its previous close at 3,859 on positive cues from Wall Street and moved northward, led by mining and infrastructure stocks. The index stayed in positive territory throughout the session and ended with a gain of 1.52% or 58.70 points at 3,918. The benchmark S&P/ASX 200 Index followed a similar trend and ended at 3,925, representing a gain of 1.5% or 57.40 points.
On the economic front, survey results released by the Westpac Bank and the Melbourne Institute revealed that the rate of contraction in the economy slowed down during May. According to the survey, Australia's leading economic index for May showed a 3.9% decline, compared to a revised year-on-year contraction of 4.1% in April.
Light sweet crude oil for August delivery ended the Asian trading session at $60.29, up 77 cents, after ending Tuesday's session in New York at $59.52, down 17 cents.
Metal stocks led the gains after commodity prices in the international market advanced for the second day. Also the third largest mining company in the world, Rio Tinto revealed an 8% rise in iron-ore output during the second quarter. The shares gained 2.00%. Among other mining stocks, BHP Billiton gained 1.51%, Fortescue Metals soared 6.39%, Gindalbe Metals rose 4.83% and Iluka Resources increased 4.24%.
Gold stocks ended in positive territory. Lihir Gold added 0.70%, Newcrest Mining advanced 0.73% and Sino Gold Mining rose 3.09%.
In the retail space, Wesfarmers, which owns Coles, added 0.61%, Woolworths gained 0.49%, David Jones gained 3.09% and Harvey Norman soared 5.19%
Banking stocks ended higher on optimism about a recovery. ANZ Bank gained 0.73%, Commonwealth Bank Australia advanced 1.36%, National Australia Bank rose 1.52%, and Westpac Bank increased 1.58%.
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