Close Australian shares jumped 1.3 per cent today to hit a one-month high, led by Telstra and buying in most major sectors after China promised more currency flexibility.
At the close, the benchmark S&P/ASX200 index was 60.7 points higher, or 1.3 per cent, at 4612.6, while the broader All Ordinaries index rose 58.6 points, or 1.3 per cent, to 4632.7.
All the major sectors in the sharemarket rose, with materials gaining 2 per cent and financials 1.3 per cent higher.
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Much of today's increased risk appetite came from news over the weekend that China was looking at a more flexible arrangement between the US dollar and the yuan, which would provide Australia with more stimulus, said CMC Markets analyst David Taylor.
"Also lifting the bourse was Telstra’s $11 billion NBN win with the government," he said. "The deal will provide shareholders with much more confidence over the telco’s earning capacity in the medium term."
The stock came back a little in afternoon trade on the back of some profit taking after initially jumping more than 7 per cent. It closed 11 cents higher at $3.34.
Yuan jumps
Asian stocks outside Japan extended their gains to 3 per cent today, after China's yuan in the spot market rose to the highest since July 2005 reflecting a clear shift in Beijing's currency policy.
In local trade, global mining giant BHP Billiton rose 78 cents to $39.91, with rival Rio Tinto gaining $1.49 to $72.34.
The banks all gained ground, with National Australia Bank up 27 cents at $25.39, ANZ up 45 cents, or 1.9 per cent, at $23.59, Commonwealth rising 69 cents to $53.28 and Westpac 28 cents higher at $23.84.
Shares in Atlas Iron rose 15 cents, or 7 per cent, to $2.30 after it said it had begun mining at its second mine and was on track to quadruple exports by the end of this calendar year.
Fortescue Metals Group shares gained 20 cents, or 4.6 per cent, to $4.57 after the company announced it was poised to sign an agreement with a Chinese engineering group for works to boost iron ore production at the Chichester Hub operations in WA.
Gloucester Coal finished 1 cent higher at $12.45 after independent directors recommended its areholders accept a $1 billion takeover bid by Singapore’s Noble Group, which already owns 87 per cent of the company.
Shares in Dexion rose 4 cents, or 5.5 per cent, to 76 cents after an announcement that GUD Holdings made an $83.8 million takeover bid for storage company.
GUD shares were in a trading halt and last traded at $8.65 while the company conducted a capital raising to assist in financing the acquisition.
Stocker joins Sigma exodus
One of the day’s biggest losers, Sigma Pharmaceuticals closed down 2.5 cents at 50 cents after chairman John Stocker resigned from the company in the fallout from its poor financial results earlier this year. The company held its annual general meeting in Melbourne today.
Shares in West Africa-focused iron ore miner Sundance Resources remain in a trading halt, having last traded at 13 cents. The trading halt follows the disappearance its entire board on a flight between Cameroon and Congo. Sundance chief financial officer Peter Canterbury has been appointed acting chief executive of the iron ore miner.
The most traded security by volume was Macquarie DDR Trust, with 268.5 million securities traded for $13.6 million. Market turnover was 2.37 billion shares changing hands for $5.66 billion, with 679 stocks up, 433 down and 381 unchanged.
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BusinessDay, with Reuters, AAP