RTTNews - The Australian market opened higher on Thursday with investors indulging in some buying after recent sharp losses. The overnight surge on Wall Street on the back of some recovery hopes is also aiding sentiment to an extent.
The Australian benchmark index S&P/ASX 200 rose to 3,911 after opening with a positive gap, but drifted lower subsequently with energy, financials and healthcare stocks facing resistance at higher levels. The index is currently trading at 3,887, up 13 points over its previous close. The broader All Ordinaries index is up 13 points at 3,885.30.
On Wednesday, the S&P/ASX 200 index ended lower by 80.90 points or 2.05% at 3,874. The All Ordinaries fell 75.50 points or 1.91% to 3,872.
Materials stock Rio Tinto is trading firm this morning. The company said the UK leg of a US$15.2 billion or A$18.78 billion capital raising has been successful, with investors taking 96.97% of the new London listed shares on offer. Rio Tinto received valid acceptances for 508.58 million new Rio Tinto plc shares under a 21 for 40 right issues at 1400 pence per share. The take-up accounts for almost all of the 524.46 million shares available under the issue.
The miner is also offering its Australian investors the chance to take part in a 21 for 40 rights issue involving 150.02 million new Australian listed shares at A$28.29 each. The results of the Australian offer will be announced tomorrow.
BHP Billiton is up nearly 2% on strong buying support. Newcrest Mining, Bluescope Metal and Mihir Gold are among the other prominent gainers in the materials space.
Energy stocks are trading mixed. Among bank stocks, Westpac Banking Corp. and Commonwealth Bank of Australia are trading weak, while ANZ Bank and National Australia Bank are trading modestly higher.
Shares of contract miner and capital goods index heavyweight Leighton Holdings is trading firm with a near 2% gain.
In the currency market, the Australian currency opened on a firm note against the U.S. dollar. The Australian dollar traded at US$0.8081/85 earlier this morning, up from Wednesday's close of US$0.8061/64. and is currently trading at 0.8069 to the U.S. dollar.
Among other markets in the Asia-Pacific region, New Zealand is trading with modest gains. Japan, Korea and Singapore are currently trading flat.
Wall Street ended with modest gains Wednesday amid low volumes. While the data on manufacturing activity and pending home sales fell in line with expectations and resulted in an early surge, weak employment and construction spending data hurt sentiment to an extent and wiped off some early gains.
The Dow closed up by 57.06 points at 8,504.06, the Nasdaq rose by 10.68 points to 1,845.72, and the S&P 500 advanced by 4.01 points to 923.33.
Stock markets across the Asia-Pacific region ended Wednesday's session on a mixed note. Japan's benchmark Nikkei 225 Index closed down by 0.2%, while South Korea's KOSPI Index closed up by 1.6%. Trading in Hong Kong was closed for the day.
Major European markets closed notably higher, with the German DAX Index and French CAC 40 Index rising by 2% and 2.4%, respectively. The U.K.'s FTSE 100 Index also moved higher, advancing by 2.2%.
Oil prices fell after bouncing above US$71 following a mixed report on U.S petroleum inventories. Crude oil reserves fell 3.7 million barrels in the week ending June 26, recording the fourth weekly drop in a row. On Wednesday, light sweet crude for August delivery on the New York Mercantile Exchange ended at US$69.31 a barrel, down US$0.58.
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