Market Wrap: ASX up on EU plan

Market Reports

The Australian share market has ended the day 1.2 per cent higher for the last trading day of the financial year as investors react positively to Europe’s plans to stabilise the region’s banking system. 

The figures
 
Today, the S&P/ASX 200 index gained 50 points finishing the week 46 points stronger at 4,095. On the futures market, the SPI is currently 36 points higher.
 
Looking at Wall Street, over its four trading days this week: The Dow Jones Industrial Average gained 29 points. The S&P 500 Index is up 4 points, the Nasdaq lost 10 points and the 100 Index shed 20 points. 
 
To company news

David Jones Limited (ASX:DJS) reveals it has had an unsolicited approach from EB Private Equity to buy the retailer for $1.65 billion. Little is known about the UK firm’s financial capacity or management and there is some question around the numbers – according to David Jones’ press release the offer is made up of $850 million of equity provided by the EB Private Equity led consortium, $450 million of lending by a syndicate of banks and investment institutions and another $450 million in residual equity. Add this all up and it totals $1.75 billion assuming the amounts are calculated in Australian dollars, although the currency isn’t stated, that’s well above the $1.65 billion reportedly on offer. The chairman has advised shareholders to treat any market commentary cautiously, but that didn’t stop DJs shares leaping on the news. David Jones shares soared 14.6 per cent, closing at $2.59.  
 
Alcoa Inc (ASX:AAI) expects to operate the Point Henry aluminium smelter until at least mid 2014. The future of the smelter in Geelong, Victoria had been under review since earlier this year because of difficult economic conditions for the industry. Alcoa says they’re found savings and had government assistance, but some structural changes will see the workforce reduced by about 10 per cent. Alcoa shares last traded at $8.50.  
 
St Barbara Limited (ASX:SBM) and Allied Gold Mining Plc (ASX:ALD) reach an agreement to combine the two companies through a scheme of arrangement.
 
And grocery wholesaler Metcash Limited (ASX:MTS) says it’s successfully completed a $325 million share placement.
 
Best and worst performers
 
The best performing sector is Materials gaining 189 points to close at 9,447. The worst performing sector was Consumer Staples, losing 40 points to close at 7,708. 
 
The best performing stock in the S&P/ASX 200 was Intrepid Mines Limited (ASX:IAU), rising 24.1 per cent to close at $0.52. Shares in David Jones Limited (ASX:DJS) and Linc Energy Limited (ASX:LNC) also closed higher.
 
The worst performing stock was St Barbara Limited (ASX:SBM), dropping 16.51 per cent to close at $1.77. Shares in Metcash Limited (ASX:MTS) and Sundance Resources Limited (ASX:SDL) also closed lower. 
 
Commodities

Gold is trading at $US1,569 an ounce and is $1.97 lower on the week. Light crude is $1.88 higher at $US79.57 a barrel.

The Australian dollar

The Australian dollar is buying $US1.017, gaining more than half a cent over the week.