(Australian Associated Press)
Australian shares have held on to positive territory on Tuesday after riding an early boost from a record close on Wall Street.
The S&P/ASX200 index closed up 0.5 per cent at 5,428.7 points as gains in metal prices drove miners higher while energy stocks defied a fall in global oil prices.
US stocks hit new highs as global markets shrugged off concerns about Italy’s lost referendum on constitutional reform, while the latest data on Australia’s federal balance of payments showed strong commodity prices pushed the current account deficit to its lowest level in two years in the September quarter.
After peaking above 4,451points at lunchtime, the benchmark S&P/ASX200 drifted lower in afternoon trading, albeit with little effect from a widely expected Reserve Bank of Australia decision to leave the official interest rate unchanged at 1.5 per cent.
CMC Markets chief market strategist Michael McCarthy said confidence had returned to the market.
“It’s no surprise to see the materials sector doing well today, following the rally on copper prices and other metals, but perhaps more surprising is the performance of the energy sector, which is up despite the fact oil prices fell overnight,” Mr McCarthy said.
Consumer staples were a dull patch with Woolworths down 1.3 per cent to $22.40 and Wesfarmers, owner of Coles, down 0.4 per cent to $40.19.
“There are real concerns Woolworths hasn’t done enough to explain to the market what its strategy will be to deal with, not only company specific threats, but threats from competition,” Mr McCarthy said.
“Even though by value this is the most shorted stock on the market, I would expect to see further short selling … it’s a fairly ugly looking picture,” Mr McCarthy said.
In company news, Origin Energy shares gained 2.5 per cent to $6.58 after the gas and power retailer announced a plan to spin off its oil and gas portfolio via an ASX listing.
* At the close, the benchmark S&P/ASX 200 index was up 28.3 points, or 0.52 per cent, at 5,428.7.
* The broader All Ordinaries index was up 28.6 points, or 0.52 per cent, at 5,486.6 points.
* The December share price index futures contract was up 31 points, or 0.57 per cent, at 5,428, with 32.423 contracts traded.
* National turnover was 2.9 billion securities traded, worth $7 billion.