RTTNews - The Australian market rose sharply in early trading on Wednesday, with investors picking up stocks cutting across various sectors on strong cues from Wall Street where some better-than-expected results kept the mood fairly bullish overnight. However, with traders trimming positions at higher levels, the market has pared some gains in subsequent trades.
The benchmark S&P/ASX 200 index, which opened at 3,867 and rose to 3,915.4, is currently trading at 3,893, up 25.9 points or 0.7% over its previous close. The broader All Ordinaries index is up 26.5 points or 0.7% at 3,885.3.
On Tuesday, the S&P/ASX 200 index had ended at 3,867, recording a gain of 129.6 points or 3.5%. The All Ordinaries index closed up 120.8 points or 3.23% at 3,859.
Energy and materials stocks are currently trading higher and the indices tracking their movements are up by 2%-2.5%. Financials, consumer staples, consumer discretionary, industrials and information technology stocks are also mostly trading higher.
Among energy stocks, Woodside Petroleum is up by over 1%, Santos is gaining 1.8% and Origin Energy is trading higher by 2.2%.
Materials stocks Rio Tinto, Orica, Onesteel, Bluescope Steel and Fortescue Metals are currently trading 1.5%-3% up over Tuesday's closing prices. However, BHP Billiton is trading in the red with a small loss.
In the banking space, Commonwealth Bank of Australia is up 1.2%, ANZ Bank is trading with a modest 0.5% gain and Westpac Banking Corporation is up by 0.8%. National Australia Bank is trading flat.
Among other prominent gainers, WorleyParsons is trading nearly 2.5% up and food & staples retailer Wesfarmers is up 2.6%.
In company news, information technology firm Data 3 expects an annual net profit growth of about eight per cent despite difficult conditions in the second half of the financial year. The company said total revenue for the 2008-09 financial year is expected to be approximately A$530 million, compared to A$363.7 million in fiscal 2008. Earnings before interest and tax for the year to June 30 are expected to be around A$13.2 million, up 9% on A$12.1 million in 2007/08. The company's stock is currently trading up 3% over its previous close.
In the currency market, the Australian dollar opened higher this morning as better-than-expected results from Goldman Sachs boosted higher risk assets such as equities and commodity-based currencies. In early trading today, the local unit was quoted at US$0.7926/32, up 0.99% over Tuesday's close of US$0.7849/52. The Aussie is currently trading at 0.7934 to the U.S. dollar.
Among other markets in the Asia-Pacific region, Japan is trading modestly higher. The Korean market is up sharply, with its benchmark KOSPI moving up by nearly 2.25%. The New Zealand market is trading flat. Stock markets across the region had ended Tuesday's session notably higher, with Japan's benchmark Nikkei 225 Index and Hong Kong's Hang Seng Index climbing by 2.3% and 3.7% respectively.
Amid a spate of earnings reports and economic data, stocks moved in a choppy way on Wall Street on Tuesday. The major averages all finished in the green by moderate margins, extending their gains for a second straight session.
On the economic front, a report released by the Commerce Department revealed that retail sales increased by a little more than expected in the month of June, although the sales growth was due in large part to higher gasoline prices.
According to the U.S. Labor Department, producer prices 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 percent.
The Dow closed up by 27.81 points or 0.3% at 8,359.49, the Nasdaq advanced by 6.52 points or 0.4% to 1,799.73 and the S&P 500 rose by 4.79 or 0.5% to 905.84
Major European markets also moved to the upside, with the German DAX Index and the French CAC 40 Index finishing up by 1.3% and 1% respectively. The U.K.'s FTSE 100 Index also rose, posting a gain of 0.9% on the day.
Crude oil finished lower for the ninth time in ten sessions and below US$60 on Tuesday. Light sweet crude for August delivery fell to US$59.52 per barrel, down 17 cents on the session. Prices touched as high as US$61.46 earlier in the session, but later hit as low as US$59.15.
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