Close Shares ended the day slightly higher, after gains were shaved in afternoon trade as regional sharemarkets turned south.
At the close, the benchmark S&P/ASX200 index was up 11.6 points, or 0.3 per cent, at 4626.5, after earlier rising to a fresh four-month high of 4649.1. The broader All Ordinaries index gained 14.9 points, or 0.3 per cent, to 4669.1.
Among the sectors, materials rose 1 per cent, energy gained 0.8 per cent, while financials were flat and IT shares lost 1.5 per cent.
need2know:
- Japan's Nikkei index slips 0.2%
- The dollar hovers above 93 US cents
- Oil trades at $US77, near 1-month high
- Gold adds $US4 to $US1249
- Dow futures are steady at 10,467
Analysts said the benchmark index's close above 4622 signalled a technical break-out from its recent trading range high of 4600, which was a positive sign and set up the next target around 4720.
National Australia Bank’s monthly business confidence index rose to 11 in August, reversing a decline in July, and was slightly better-than-expected, adding to the market's positive sentiment.
Austock Securities senior client adviser Michael Heffernan said local investors were in good spirits after strong economic data from China and proposed US banking reforms.
‘‘The market’s almost, I was going to say, on fire, but it’s more like the kindling is getting stronger, so to speak,’’ Mr Heffernan said. ‘‘I think the key thing for me is building on strong performances over the last couple of days - there’s a decided change in sentiment compared to, say, two weeks ago.’’
BHP Billiton rose 49 cents, or 1.3 per cent, to $39.05, while fellow mining giant Rio Tinto lost 15 cents, or 0.2 per cent, to $75.15.
Rio spends on projects
Rio Tinto said it would invest $US803 million to upgrade its Argyle diamond mine in Western Australia. Rio Tinto also said it had used the maturation of a credit facility to increase its stake in Ivanhoe Mines to 34.9 per cent.
Ivanhoe Mines is a Canadian public company that owns 63 per cent of the ASX-listed Ivanhoe Australia. Ivanhoe Australia shares finished flat at $2.83.
Fortescue Metals Group added 5 cents, or 1 per cent, to $5.02 and energy group Orica gained 41 cents, or 1.6 per cent, to $25.64.
The energy sector posted mixed results with Oil Search closing 4 cents weaker at $6.09, Woodside Petroleum lost 7 cents to $42.90, while Santos climbed 41 cents, or 3.3 per cent, to $12.78.
CBA buys stake in Vietnam
In banking news, Commonwealth Bank announced it had taken a 15 per cent stake in Vietnam International Bank (VIB), after regulatory approvals were confirmed in Vietnam. CBA finished the strongest of the four major banks, adding 9 cents to $53.60.
National Australia Bank finished unchanged at $25.22, Westpac lost 2 cents to $23.37 and ANZ was 1 cent stronger at $24.02. Investment bank Macquarie Group finished 45 cents higher, or 1.3 per cent, at $35.70.
Among retail stocks, Woolworths was up 5 cents at $28.44, while Coles owner Wesfarmers lost 32 cents, or 0.9 per cent, to $33.88. Foster’s Group fell 5 cents, or 0.8 per cent, to $6.18.
Telecommunications giant Telstra dropped 2 cents, or 0.7 per cent, to $2.78, while Optus owner Singtel gained 2 cents at $2.47.
Gold major Newcrest finished the day 1.3 per cent, or 51 cents, higher at $39.00.
Iron ore explorer Sundance Resources extended yesterday's gains, rising 1.5 cents, or 6 per cent, to $26.5. On Monday its shares rose by 25 per cent after it signed an agreement with China Harbour Engineering Company to investigate building a bulk materials port in Cameroon in Africa.
Sundance was also the top-traded stock by volume, with 179.3 million shares worth $50.4 million changing hands. Preliminary market turnover was 2.43 billion shares worth $5.06 billion, with 667 stocks up, 460 down and 349 unchanged.
Room for more gains
"We've had better data from overseas and China in particular, and in terms of the banks, the slightly better outcome at Basel has taken the pressure off," said F.W Holst research manager David Spry.
New bank capital requirements agreed by global regulators have brought relief to the financial sector as fears that lenders might be forced into fresh capital raising were put to rest, and deadlines for meeting requirements were pushed out.
"I think there is room for a bit more upside, particularly with bank deposit rates lower people may be switching into equities," he said.
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AAP, with BusinessDay