Some encouraging company earnings reports, a positive lead from US markets and higher commodity prices have helped lift the Australian share market by about 0.7 per cent to its best close in a month.
Atlantic Pacific client adviser Gary Huxtable said the strong performance of US markets on Friday, on the back of US President Donald Trump’s promise of “phenomenal” tax reform, had boosted local investor sentiment today.
Also, a good earnings report from electronics retailer JB Hi-Fi gave investors confidence in the retail sector, and investors had also reacted favourably to earnings reports from rail freight operator Aurizon and packaging giant Amcor.
The rising iron ore price gave a strong lift to the heavyweight mining stocks: BHP Billiton, Rio Tinto and Fortescue Metals..
“It’s the materials space where most of the action today is, especially Fortescue,” Mr Huxtable said.
The major miners surged after the iron ore spot price jumped $US3 to $US86.85 overnight, and copper hit a 20-month high.
BHP Billiton rose 57 cents, or 2.2 per cent, to $26.45, Rio Tinto added $2.37, or 3.6 per cent, to $68.32 , and Fortescue Metals jumped 40 cents, or 6.2 per cent, to $6.88.
Gold miner Newcrest gained 18 cents to $22.72. Newcrest will pay its first interim dividend in four years after more than doubling first-half profit on the back of higher prices and increased gold and copper production.
JB Hi-Fi surged 3.2 per cent to $29.38 as strong sales of computers, cameras and home appliances helped drive the company’s half-year profit up by 16 per cent.
Rail freight operator Aurizon was 13 cents, or 2.5 per cent, richer at $5.33 after it swung to a first-half net profit of $54 million from a $108 million loss a year ago, backed by cost cuts from its ongoing restructuring program.
Global packaging company Amcor improved 63 cents, or 4.3 per cent, to $15.18. Amcor says it is on track to deliver another year of strong earnings growth in the 2017 full financial year as it benefits from recent acquisitions and restructuring of its flexible packaging business.
The big four banks were all up by between 0.2 and 0.6 per cent, with ANZ the best performer.
Meanwhile, the Australian dollar was stronger against the greenback at 76.67 US cents at 1700 AEDT, up from 76.40 on Friday.
ON THE ASX:
* On Monday, the benchmark S&P/ASX200 was up 40.1 points, or 0.7 per cent, at 5,760.7 points.
* The broader All Ordinaries index was up 41.3 points, or 0.72 per cent, at 5,812.9 points.
* The March SPI200 futures contract was up 45 points, or 0.79 per cent, at 5,712 points., with 31,914 contracts traded at 1630 AEDT.
* National turnover was 3.5 billion securities worth $5.7 billion.
CURRENCY SNAPSHOT AT 1700 AEDT:
One Australian dollar buys:
* 76.67 US cents, from 76.40 on Friday
* 87.186 Japanese yen, from 86.87 yen
* 72.15 euro cents, from 71.72 cents
* 61.34 British pence, from 61.13 pence
* 106.42 New Zealand cents, from 106.30 NZ cents
GOLD:
The spot price of gold in Sydney at 1700 AEDT was $US1, 229.40 per fine ounce, down $US5.23 from $US1,224.17 on Friday.
BOND SNAPSHOT AT 1630 AEDT:
* CGS 5.25 per cent March 2019, 1.8096pct, from 1.819pct
* CGS 4.25pct April 2026, 2.6518pct, from 2.637pct
Sydney Futures Exchange prices:
* March 2017 10-year bond futures contract at 97.26 (implying a yield of 2.74pct), from 97.275 (2.725pct) on Friday
* March 2017 3-year bond futures contract at 98.04 (1.96pct), unchanged
(*Currency closes taken at 1700 AEDT previous local session, bond market closes taken at 1630 AEDT previous local session)
