Midday: Aus shares surge up 0.8%

Market Reports

The Australian share market opened stronger as investors heeded late gains in US markets rather than fiscal cliff concerns, after US stocks pared back what threatened to be significant falls despite still finishing lower. The local market has surged to be 0.8 per cent higher at noon, with local resources stocks being boosted by rising iron ore prices.

The S&P/ASX 200 index is 37 points up at 4,685. On the futures market the SPI is 38 points higher.

Company news

Fortescue Metals Group Limited (ASX:FMG) CEO Nev Power says the iron ore miner won’t be reinstating the 1,000 positions culled four months ago despite plans for a major production ramp up taking shape with the reactivation of the King’s deposit in the Pilbara. Mr Power says measures taken in September, including staff cuts, debt re-financing and the halt on Kings, mean it can cope with future market volatility. Shares in Fortescue are trading up 1.55 per cent at $4.60.

Newcrest Mining Limited (ASX:NCM) chief Greg Robinson is reportedly under pressure to deliverconsistent and predictable share performance from Australia’s largest listed gold producer after a difficult year. According to news corp reports, Newcrest is at risk of missing its previously issued earnings guidance after its shares have fallen 24 per cent in the year, amounting to a value loss of $5.4 billion. Shares in Newcrest are trading up 1.15 per cent at $22.78.
Best and worst performers 

It’s all resources today on the back of the rising iron ore price: The best performing sector is Materials gaining142 points to 10,709. Shares in Mount Gibson Iron Limited (ASX:MGX) have risen 6.21 per cent and trading at $0.85. Shares in Silver Lake Resources Limited (ASX:SLR) and Iluka Resources Limited (ASX:ILU) are also stronger.

All sectors are higher today, the least gains are in Real Estate Investment Trusts, adding 2 points to 977. Shares in Goodman Group (ASX:GMG) have fallen 0.34 per cent, trading at $4.34. Shares in DEXUS Property Group (ASX:DXS) are slightly lower while Centro Retail Australia Limited (ASX:CRF) are slightly higher. 

Gold and the dollar

Gold is trading at $US1,663 an ounce and the Australian dollar is buying $US1.037.