Close The Australian sharemarket has closed little changed for the day after the surprise move by the Reserve Bank to lift interest rates.
The benchmark S&P/ASX200 index rose 2.9 points, or 0.1 per cent, to 4701.4, while the broader All Ordinaries index gained 2.4 points, or 0.1 per cent, to 4773.3.
Among the sectors, financials rose 0.5 per cent, while materials were off 0.2 per cent and gold shares dropped 0.7 per cent.
The dollar soared on the RBA's unexpected decision, adding one US cent to close locally at 99.8 US cents.
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Commonwealth Bank led the gains made by most of the big banks after it raised its standard variable mortgage rate by 45 basis points, nearly doubling the RBA's move.
Speculation for an RBA increase actually eased last week after official figures showed lower than expected inflation for the September quarter.
Commonwealth finished up 88 cents, or 1.8 per cent, at $50.19.
Banks the driving force
Bell Potter senior adviser Stuart Smith said the banks were the driving force behind the market after a very quiet Melbourne Cup day.
‘‘They’re mulling over whether they can raise mortgage rates,’’ Mr Smith said. ‘‘We’ll see the answer tonight or in the morning’s paper.’’
Westpac, ANZ and National Australia Bank have yet to make statements.
Westpac finished up 26 cents, or 1.1 per cent, at $23.31, and ANZ closed 13 cents higher at $25.03, while National Australia Bank ended 1 cent lower at $25.88.
Mr Smith said the session overall was quiet on volume but picked up after the RBA announcement.‘‘We’ve done a billion dollars in an hour and a half,’’ he said of the market’s reaction to the rate rise.
Other financials finished lower. AXA Asia Pacific ended down 8 cents at $5.46, AMP dropped 6 cents to $5.31 and Macquarie Group was 25 cents weaker at $36.15.
The major miner’s closed mostly lower. BHP Billiton lost 3 cents to $42.27 and Rio Tinto ended down 28 cents at $82.71. But Fortescue Metals was 11 cents higher at $6.42.
Leighton hit by profit warning
Leighton Holdings was the worst performer on the S&P/ASX 50, after it said it would downgrade first quarter profit by $85 million due to problems associated with the Brisbane Airport Link project, and effect of the strong Australian dollar on earnings. Leighton ended down $2.55, or 7 per cent, at $33.75.
Gold miner Newcrest Mining closed down 44 cents at $39.93.
Westfield Group was the highest performer on the S&P/ASX 50 before it was placed in a trading halt while it prepared to make an announcement about a possible transaction.
Shares in the retail property group last traded up 24 cents, or 1.9 per cent, at $12.81.
In other news, Baskin Robbins and Cookie Man franchise holder Allied Brands has called in voluntary administrators, after losing its licence to operate the 92 branded ice-cream stores Australia wide. Allied Brands is in a trading halt, last trading at 1.7 cents.
MAp charts jump in earnings
Sydney airport operator MAp Group shares were flat at $3.07 after it said earnings for the year to date are up 19.5 per cent with traffic growth of 7 per cent across the board.
Industrial Minerals Corporation ended up 0.5 cents, or 2.9 per cent, at 18 cents after saying it’s on track to bring its $US50 million Oregon heavy minerals project in the US into production in late February next year.
Shares in rare earths explorer Arafura Resources ended down 11.5 cents, or 8.3 per cent, at $1.27 after a major Chinese shareholder said it would allow its stake to be diluted under Arafura’s $90 million capital raising.
The top-traded stock by volume was Alcyone Resources, with 73.72 million shares worth $3.61 million changing hands. Alcyone shares ended steady at 4.6 cents after the precious metals explorer announced the results of test drilling at its Twin Hills prospect in Queensland.
Preliminary national turnover was 1.71 billion shares worth $3.40 billion, with 491 stocks up, 561 down and 348 unchanged.
BusinessDay, with AAP, Reuters