RTTNews - Tracking last Friday's strong close on Wall Street where stocks had rallied quite sharply on better-than-expected employment data, the Australian market opened on a firm note on Monday with stocks across various sectors surging higher in early trading.
Mirroring the buoyant mood, the Australian benchmark index S&P/ASX 200 is currently trading up with a gain of 41 points or 1% at 4,340. The broader All Ordinaries index is up by 44.4 points or 1% at 4,348.
On Friday, the S&P/ASX 200 index had ended down 26.9 points or 0.62% at 4,299, while the All Ordinaries index fell 27.9 points or 0.64% to 4,303.
Among major stocks from the materials space, BHP Billiton is up by a modest 0.7%, but the other heavyweight Rio Tinto is trading nearly a percent down. Bluescope Steel is up nearly 5% and Fortescue Metals is gaining 3.5%. Orica and Newcrest Mining are trading weak.
Energy stocks Santos, Woodside Petroleum, Oil Search and Origin Energy are trading modestly higher.
Key bank stocks ANZ Bank, Commonwealth Bank of Australia, National Australia Bank and Westpac Banking Corporation are trading with notable gains. Diversified financials stock Macquarie Group is up by over 2%.
Bendigo and Adelaide Bank has gone into a trading halt today, pending the release of an unspecified announcement. Bendigo and Adelaide Bank Ltd is reportedly seeking to raise A$300 million in fresh equity after posting a 57.7% plunge in 2008/09 net profit.
Crane Group Ltd's net profit declined 28% to A$43.6 million for the year to June 30, compared to A$60.8 million in the previous financial year.
Crane, a manufacturer of non-ferrous metal products, plastic pipeline systems and plumbing supplies, said difficult trading conditions were expected to continue and that it was unlikely that net profit before significant items in 2009/10 would exceed that of 2008/09.
In economic news, the Australian Bureau of Statistics releases housing finance data for June today.
In the currency market, the Australian dollar opened weaker today with the first decline in the US unemployment rate since April 2008 lifting investor demand for the American currency. In early trading, the Aussie was quoting at US$0.8370/78, down 0.17% from Friday's close of US$0.8386/90. The Australian dollar is currently trading at 0.8375 to the U.S. dollar.
Among other markets in the Asia-Pacific region, Japan is up sharply with its key index Nikkei moving up by nearly 1.5%. The New Zealand and Korean markets are trading modestly higher. Stock markets across the region had turned in a mixed performance last Friday.
On Wall Street, buoyed by encouraging economic data, stocks rallied sharply and ended on a firm note last Friday. Buying interest in stocks was sparked by a Labor Department report showing that the pace of job losses slowed by even more than economists had been anticipating in the month of July.
The report showed that non-farm payroll employment fell by 247,000 jobs in July following a revised decrease of 443,000 jobs in June. Economists had been expecting employment to fall by 325,000 jobs compared to the drop of 467,000 jobs originally reported for the previous month. The Labor Department also said that the unemployment rate unexpectedly edged down to 9.4% in July from 9.5%, recording a decrease for the first time since April 2008.
The Dow closed up by 113.81 points or 1.2% at 9,370.07, the Nasdaq moved up by 27.09 points or 1.4% to 2,000.25, and the S&P 500 ended up 13.4 points or 1.3% at 1,010.48.
Major European markets closed notably higher, with the French CAC 40 index and the German DAX index posting gains of 1.3% and 1.7% respectively, while the U.K.'s FTSE 100 index rose by 0.9%.
Oil prices turned notably lower on Friday after giving back an early rally amid lingering demand worries. A stronger U.S. dollar also lowered the hedge appeal of commodities. Light sweet crude for September dropped to US$70.93 per barrel, down US$1.01 per barrel. Prices rose as high as US$72.84 before later touching as low as US$70.38.
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