The Australian share market rallied today as investors sought some buying opportunities among the major blue-chip resources stocks. Reports before the market open of another fire breaking out in Tokyo Electric Power’s No. 4 nuclear reactor did not eventuate in another round of broad-based selling.
The S&P/ASX200 Index lifted 29 points to close at 4,558. On the futures market, the SPI is up 32 points.
In economic news: the Westpac Leading Index shows the nation’s economic growth profile has pulled back markedly as a result of the recent natural disasters. The Index grew at an annualised rate of 3.5 per cent in January, down from growth of 4.6 per cent in December.
In company news: And despite remaining broadly upbeat RIO Tinto (ASX:RIO) has been candid about the short term risks it faces in its Annual Report released today. The chairman says financial systems remain fragile, while the increase in sovereign debt – and government measures to address fiscal imbalances – are likely to temper short term growth. The miner also says it faces skills shortages and new technical challenges as it expands into more risky areas to meet rising demand. However the chief executive added while the recovery in major economies will remain uncertain and volatile, the longer-term fundamentals were strong. Shares in Rio Tinto rising 1.98 per cent to close at $78.94.
And shares in ERA (ASX:ERA) rebounded today as analysts crunched the numbers on the full impact of Japan’s nuclear disaster. The key concern is the now damaged reputation of nuclear power and the forward nuclear programs for countries like China, India and Japan. Of all the analysts surveyed though, the consensus was that uranium would unlikely test the low of 40 dollars US a pound set in March 2009. Shares in Energy Resources jumped 10.33 per cent to close at $7.80.
Also making news: Shareholders in BC Iron (ASX:BCI) have been reeling today after Hong Kong-based investment firm Regent Pacific Group announced it had canned its takeover of the company – that’s despite major shareholder Consolidated Minerals saying it hadn’t yet rejected the idea. And NAB has appointed a new C-E-O for its UK operations. Current chief Lynne Peacock will be replaced by the now chief operating officer David Thorburn.
In other news: The impact of Japan’s earthquake and tsunami has hit Billabong International Ltd (ASX:BBG). The surfwear retailer has today warned that its 2011 earnings are likely to drop by as much as six per cent as a result of the events in Japan. And Gindalbie Metals Ltd (ASX:GBG) has warned the costs of its 2 billion dollar Karara iron ore project are likely to rise by around 30 per cent
In the best and worst performers: The best performing sector today was the materials sector gaining 232 points to close at 13,205. The worst performing sector was the Real Estate Investment Trust falling 12 points to close at 831. The best performing stock in the S&P/ASX200 was Paladin...shares rising 13.5 per cent to close at $3.70. Shares in Sundance and ERA also closed in positive territory. The worst performing stock was Perseus, shedding 4.68 per cent to close at $2.65. Shares in Dexus Property and Ardent Leisure also closed weaker today.
In commodities, gold is trading at $US1,398 an ounce and Light crude is 18 cents weaker at $US97 a barrel.
