Banks drive Aust shares to four-month high

James Hall
(Australian Associated Press)


The Australian share market has closed more than one per cent higher for the first time in four months, buoyed by banking stocks after a surge on Wall Street overnight.

The benchmark S&P/ASX200 index was up 69.2 points, or 1.18 per cent, at 5939.1 points on Wednesday while the broader All Ordinaries was up 69.3 points, or 1.16 per cent, at 6047.1.

Wall Street provided a leg-up for the Australian indices following major financial and health care companies in the US reporting better-than-expected profits for the third quarter on Tuesday, Bell Direct equities analyst Julia Lee said.

“This earnings season we’re expecting to see growth of 19.2 per cent, so that’s the sixth time out of seven quarters we would have seen double-digit growth coming out of the US,” she said.

Commonwealth Bank and Westpac led the big four’s gains on Wednesday, up 1.7 and 1.6 per cent respectively, followed by a one per cent climb for ANZ and a 0.08 per cent lift for NAB.

Healthcare and infotech shares helped drive up the market.

The infotech sector was up nearly two per cent, with gains for Link Admin, Computershare, and Xero Ltd, as the sector turned around recent fortunes, having lost ground for 11 of the past 12 sessions.

Afterpay, however, took a significant hit, closing 18.9 per cent down reacting to speculation it could face a Senate inquiry around its business practices.

Healthcare shares climbed, gaining 2.6 per cent, with Ramsay Health Care, ResMed and Cochlear all up more than three per cent, while CSL shares were up 2.5 per cent.

The heavyweight materials sector was the only drag on the market, dipping 0.3 per cent on sliding copper and iron ore, and a flat gold price.

In companies news, A2 Milk’s share price jumped 8.5 per cent to $9.80 after forecasting further growth in nutritional products locally and in China, and liquid milk products in the US.

But Reject Shop’s shares went the other way, plummeting nearly 40 per cent after the discount retailer slashed its profit guidance due to slumping sales.

The Australian dollar held its ground as a rebound in global equities pointed to some improvement in risk appetite after a rough couple of weeks.

The Aussie was buying 71.35 US cents at 1630 AEDT, from 71.22 US cents on Tuesday.


* The S&P/ASX200 was up 69.2 points, or 1.18 per cent, at 5939.1 points

* The All Ordinaries was up 69.3 points, or 1.16 per cent, at 6047.1

* In futures trading the SPI200 futures index was up 72 points, or 1.23 per cent, at 5926.0 points at 1630 AEDT.


One Australian dollar buys:

* 71.35 US cents, from 71.22 US cents on Tuesday

* 80.07 Japanese yen, from 79.86

* 61.78 euro cents, from 61.58

* 54.20 British pence, from 54.18

* 108.41 NZ cents, from 108.50


The spot price of gold in Sydney at 1630 AEDT was $US1220.93 per fine ounce, up from $US1225.66 on Tuesday.


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Categories: Finance