the asx rebounds from beaten down levels despite greek tremors 1637132015
A late rally in the session helps stocks end solidly in positive territory
Value buying pushed Australian stocks to a positive close Tuesday after prices fell to attractive levels in the previous session’s selloff. Shrugging off the prospect of an imminent default by Greece, investors instead took advantage of a dip in the market in the opening hour to pick up bargains. A sharp rally in the last hour took the S&P/ASX 200 to its best level of the day of 5,466.60, and a close just a shade below that.
Indices and sectors
The benchmark S&P/ASX 200 rose 36.5 points, or 0.7 per cent, and closed at 5,459, while the broader All Ordinaries index was up 34.6 points, or 0.6 per cent, at 5,451.2.
The top gaining sectors were industrials (+1.54 per cent), energy (+1.10 per cent), telecommunications services (+1.05 per cent), healthcare (+0.97 per cent) and consumer discretionary (+0.80 per cent). Information technology (-0.15 per cent) and utilities (-0.09 per cent) were the only losing sectors.
Stocks
Mining and energy stocks put up a mixed show. BHP Billiton Limited (ASX:BHP) gained 0.37 per cent to AU$27.05, Rio Tinto Limited (ASX:RIO) was up 0.86 per cent to AU$53.75 and Fortescue Metals Group Limited (ASX:FMG) dipped 1.04 per cent to AU$1.91.
Woodside Petroleum Limited (ASX:WPL) rose 0.71 per cent to AU$34.23 and Origin Energy Ltd (ASX:ORG) surged 6.02 per cent to AU$11.97. However, Oil Search Limited (ASX:OSH) fell 0.42 per cent to AU$7.13 and Santos Ltd (ASX:STO) was down 1.39 per cent to AU$7.83.
The major banks all ended higher. Commonwealth Bank of Australia (ASX:CBA) was up 0.52 per cent to AU$85.13, Westpac Banking Corp (ASX:WBC) gained 0.41 per cent to AU$32.15, Australia and New Zealand Banking Group (ASX:ANZ) was up 0.41 per cent to AU$32.20 and National Australia Bank Ltd. (ASX:NAB) rose 0.33 per cent to AU$33.31.
Stocks in the retail sector closed mixed. Wesfarmers Ltd (ASX:WES), the owner of supermarket chain Coles, rose 0.83 per cent to AU$39.03 and Myer Holdings Ltd (ASX:MYR) gained 0.82 per cent to AU$1.23. However, Woolworths Limited (ASX:WOW) fell 0.11 per cent to AU$26.96, and Caltex Australia Limited (ASX:CTX) declined 0.81 per cent to AU$31.85. Shares in Kathmandu Holdings Ltd (ASX:KMD) surged 25.60 per cent to AU$1.57 after New Zealand retailer Briscoe Group Limited (NZE:BGR) boosted its stake in the company from 4.98 per cent to 19.9 per cent, according to ABC. Briscoe said it intended to make a cash and stock takeover bid for Kathmandu, according to ABC.
Economic news, currency and market outlook
Statistics on credit released by the Reserve Bank of Australia showed that lending to housing investors was up 0.8 per cent in May and 10.4 per cent year-on-year, according to ABC. It shows that banks have been unable to rein in the credit flow to housing speculators despite the limit of 10 per cent growth suggested by banking regulator APRA through the use of “macro-prudential” tools. On an overall basis housing credit was up 7.2 per cent year-on-year.
On the other hand, data from the Housing Industry Association showed that after having improved over the past four months, sales of new dwellings actually declined by 2.3 per cent in May, led by a 5.1 per cent fall in sales of detached houses. However, apartment and townhouse sales surged 7.6 per cent on the month and 26.7 per cent over the past three months.
Stocks closed higher on Wall Street Tuesday following news of last-minute, hectic diplomatic negotiations to avoid a Greek default. The Dow Jones Industrial Average gained 23 points, or 0.1 per cent, to 17,619, while the S&P 500 added 5 points, or 0.3 per cent, to 2,063. The Nasdaq Composite Index rose 28 points, or 0.6 per cent, to 4,987.
The Australian dollar is trading higher against the US dollar following the last-minute appeal by Greece to the Eurogroup and its efforts to avoid a default and likely exit from the Eurozone. According to the Business Spectator, at 07:00 this morning (AEST) the local currency was trading at 77.06 US cents, up from 76.71 US cents on Tuesday.
The Australian stock market is likely to open lower today given that at 06:59 am (AEST) this morning the September ASX SPI200 Index (AP) Futures were down 29 points at 5,368.
