RTTNews - Tracking overnight cues from Wall Street where stocks ended on an upbeat note on strong economic data, the Australian market opened higher on Tuesday and is currently trading firm, with energy, material and financial stocks recording impressive gains.
The Australian benchmark index S&P/ASX 200 hit a new 9-month high at 4,333.9 this morning and is currently trading at 4,331.7, up 68.3 points or 1.6% over its previous close. The broader All Ordinaries index is up by 68.7 points or 1.6% at 4,339.2.
On Monday, the S&P/ASX200 index had ended at 4,263.4 with a gain of 19.4 points or 0.5%. The All Ordinaries index closed up 21 points or 0.5% at 4,270.5.
Materials majors Rio Tinto and BHP Billiton are currently trading stronger by 5.7% and 3.7% respectively. Bluescope Steel is up by 4.3%, Fortescue Metals is trading higher by 2.4%, Incitec Pivot is up by 3.4%, Newcrest Mining is trading 2.3% up and Onesteel is up by 3.7%.
In the energy space, Woodside Petroleum is gaining 1.5%, Santos is up by over 2%, Oil Search is trading up 1.3% and Origin Energy is gaining 2.2%.
ANZ Banking Group Ltd has agreed to buy some of Royal Bank of Scotland Plc's Asian businesses for about US$550 million, as it pursues its strategy to become a super regional bank. The bank will buy the retail, wealth management and commercial businesses in Taiwan Singapore, Indonesia and Hong Kong, as well as RBS's institutional banking businesses in Taiwan, the Philippines and Vietnam.
The businesses are expected to add to earnings per share within two years of completing their takeover, Melbourne-based ANZ said in a statement on Tuesday. The ANZ Bank stock is trading more than a percent up at present.
Among other key stocks in the banking space, Commonwealth Bank of Australia is up by 1.2%, National Australia Bank is gaining 1.8% and Westpac Banking Corporation is trading nearly a percent up. Diversified financial stock Macquarie Group is up by about 1.5%.
Insurance stocks QBE Insurance and Suncorp Metway are up by 1.6% and 1.2% respectively.
Shares of Navitas Ltd are surging higher today on strong results. The company increased full-year profit 31.4% and said it is well placed to deliver double-digit earnings growth in 2009/10. Net profit of the company rose to A$49.2 million for the 12 months to June 30 compared with A$37.2 million in the year to June 30, 2008. Revenue rose 36% to A$470.7 million. The stock is currently trading higher by 3.7%.
In economic news, the Commonwealth Bank and the Australian Chamber of Commerce and Industry release their business expectations survey covering the June quarter. Also, the Australian Bureau of Statistics releases retail trade data for June and the June quarter, as well as the house price index data for the June quarter. Meanwhile, the Reserve Bank of Australia holds its August board meeting to consider interest rates.
In the currency market, the Australian dollar rose to a 10-month high on positive earnings results from the U.K. and buoyant U.S. manufacturing data. In early trading this morning, the Aussie was quoting at US$0.8419/23, up from Monday's close of US$0.8355/60. The Australian dollar is currently trading at 0.8435 to the U.S. dollar.
Among other markets in the Asia-Pacific region, Japan, New Zealand and Korea are trading notably higher with their benchmark indices moving up by 1%-2%. The Singapore market is also trading with strong gains. Stock markets across the region had finished Monday's trading mostly higher.
Fueled by better-than-expected economic data, stocks surged higher on Wall Street on Monday. The Nasdaq and the S&P 500 moved past the key technical levels of 2,000 and 1,000, respectively.
A report from the Institute for Supply Management showed a much slower than expected pace of contraction in manufacturing activity in July and significant improvements in new orders and production. Data from the U.S. Commerce Department revealed that construction spending rose 0.3% percent in June following a revised 0.8% slide in May. Economists were expecting a decline of 0.5% for the month.
The Dow closed up by 114.95 points or 1.3% at 9,286.56, the Nasdaq ended up 30.11 points or 1.5% at 2,008.61 and the S&P 500 moved up by 15.15 points or 1.5% to 1,002.63.
Major European markets closed notably higher, with the French CAC 40 index and the German DAX index posting gains of 1.5% and 1.8% respectively, while U.K.'s FTSE 100 index gained 1.6%.
Crude oil continued its upward surge on Monday, extending a seven-week high. Encouraging economic data improved the prospect of energy demand. Light sweet crude for September delivery rallied to US$71.58, up US$2.13 on the session. Prices reached as high as US$72.10 earlier in the day.
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