RTTNews - The Australian stock market opened on a bright note Friday despite a none too strong close on Wall Street where stocks had remained choppy overnight on some largely disappointing economic reports. Higher commodity prices and hopes of a swift economic recovery appear to be driving stock prices up sharply in the Australian market this morning. Materials, energy and financial stocks are leading the charge.
The benchmark index S&P/ASX 200, which rose to a new 10-month high of 4,509.5 this morning, is currently trading at 4,493.3, up 57.4 points or 1.3% over its previous close. The broader All Ordinaries index is up by 58 points or 1.3% at 4,494.7. The All Ordinaries index touched a high of 4,506.5 earlier in the day.
On Thursday, the S&P/ASX200 index had added 92.8 points or 2.1 percent to end at 4,435.9 while the All Ordinaries index closed up 90.8 points or 2.1% at 4,436.7.
Among key bank stocks, ANZ Bank is up 2.2%, Commonwealth Bank of Australia is gaining 1.7%, National Australia Bank is up by over 3% and Westpac is trading higher by 1.4%. Macquarie Group, the diversified financial company is trading nearly 2% up.
In the materials space, heavyweights Rio Tinto and BHP Billiton are up by 3% and 1.5% respectively. Incitec Pivot is up by over 6.5% and Bluescope Steel is gaining about 2.5%.
Newcrest Mining and Orica are exhibiting some weakness.
Energy stocks Oil Search, Santos, Origin Energy and Woodside Petroleum are trading higher by 0.5%-1.5%.
Leighton Holdings Ltd posted a 28% fall in annual net profit, but forecast net profit to reach about A$600 million in the current year. The construction major attributed the fall in net profit to A$440 million in the year to June 30 to a reduced contribution from property development in addition to impairments on the company's investments. But the company's stock is currently trading firm with a sharp 6.7% gain. The company has announced that Thiess Services, its wholly owned subsidiary, won a contract worth A$380 million for the South East Water Capital Works Program.
Print, distribution and media services group PMP Ltd has posted a full-year loss after a turbulent year and expects trading conditions to remain challenging this financial year. The company reported a net loss of A$27.2 million for the year ended June 30, compared to the A$78.9 million profit it posted in the previous financial year. The company recorded A$65.2 million in significant items, related to redundancy and restructuring costs, and asset write downs. PMP's net profit before significant items decreased 61% to A$18.2 million. The stock is trading lower by 2.7%.
In the currency market, the Australian dollar opened firm as growth in the German and French economies buoyed investor hopes for a recovery and lifted demand for commodities-driven currencies. Earlier this morning, the Aussie was trading at US$0.8427/31, up 0.54% over Thursday's close of US$0.8382/86. The Australian dollar is currently trading at 0.8461 to the U.S. dollar.
Among other markets in the Asia-Pacific region, New Zealand, Korea and Singapore are up sharply. The Japanese market is also trading higher with modest gains. Stock markets across the Asia-Pacific region had closed higher on Thursday.
On Wall Street, stocks managed to post modest gains overnight despite largely disappointing retail sales and jobs reports contributing to some uncertainty in the markets. Stocks saw some upside following the results of the Treasury Department's US$15 billion sale of thirty-year bonds.
The Dow finished up by 36.58 points or 0.4% at 9,398.19, the Nasdaq moved up by 10.63 points or 0.5% to 2,009.35 and the S&P 500 edged up by 6.92 points or 0.7% to 1,012.73.
Major European markets also closed on the upside, with the German DAX index and the U.K.'s FTSE 100 index posting gains of 1% and 0.8% respectively, while the French CAC 40 index ended up by 0.5%.
Crude oil finished modestly higher on Thursday as data showed the German and French economies saw growth in the second quarter, boosting the outlook for global energy demand. A weaker dollar also improved oil's hedge value. Light sweet crude closed at US$70.52 per barrel, up 36 cents on the session. Oil touched as high as US$72.21 earlier.
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