Australian shares had a positive day to finish 0.68 per cent higher, managing to recover most of the early week losses. Energy and banks both had strong sessions after more optimistic economic data brightened the mood. Though any break out activity was curtailed as global markets await the latest US labour market data.
The Week
Today, the S&P/ASX 200 index closed 35 points up to finish at 5,166.5. Over the week, that left the index 23.5 points lower.
The value of trades was $4.7 billion on volume of 793 million shares at the close of trade. The top three stocks by value were Commonwealth Bank of Australia
(ASX:CBA), Westpac Banking Corporation
(ASX:WBC) and BHP Billiton Limited
(ASX:BHP).
On the futures market the SPI is 37 points up.
Looking at Wall Street, US stocks have dropped over the four trading days this week: The Dow Jones Industrial Average lost 220 points. The S&P 500 Index lost 21 points. The NASDAQ lost 66 points. The 100 Index lost 35 points.
Economic news
The prevailing caution around China pushed Shanghai lower as it restarted trade after the New Year holiday. The Shanghai Global Composites started the Year of the Horse in negative territory, with analysts expecting Shanghai, along with other emerging markets, to remain weak.
The RBA suspects a combination of the falling dollar, soft wages growth and a lack of capacity may be pushing higher prices through to consumers more quickly than it has in the past. The central bank announced in its quarterly RBA Statement on Monetary Policy that inflation may break the target 2 to 3 per cent band after rising to 2.7 per cent in the December quarter. The RBA is optimistic about economic growth though, saying today it believes growth for the year to December 2014 will be between 2.25 per cent and 3.25 per cent, an improvement on all recent forecasts.
Company news
Aurora Oil & Gas Limited
(ASX:AUT) today received an offer from Canadian oil driller Baytex, worth a total $1.84 billion. The Canadian offered $4.10 a share. The news saw Aurora shares rocket to as much $4.09, indicating the market believes the deal will be done. Baytex deals mostly in the emerging technology of shale oil production, an area Aurora had been successfully pursuing in the US, leading some analysts to suggest Aurora was undervalued by local investors. Shares in Aurora Oil & Gas Limited
(ASX:AUT) closed 56.11 per cent up at $4.09.
DEXUS Property Group
(ASX:DXS) has announced it has taken a controlling interest in real estate investment trust Commonwealth Property Office Fund
(ASX:CPA). The business property company had previously held 48.27% of voting rights, that has now moved to 50.15%.
Shares in DEXUS Property Group
(ASX:DXS) closed 0.99 per cent up at $1.02.
Woodside Petroleum Limited
(ASX:WPL) has signed a non-binding memorandum of understanding with its joint venture partners for the acquisition of a stake in the Levathian gas project in Israel. Woodside is interested in purchasing a 25 per cent stake in two petroleum licences. Shares in Woodside Petroleum Limited
(ASX:WPL) closed 0.11 per cent down.
News Corp Limited
(ASX:NWS) has posted a slight fall in second quarter revenue of $2.2 billion, down 4 per cent on the same period a year ago. The company pointed to a soft media advertising market and the sale of Dow Jones for the fall, but also highlighted increased revenues from the ongoing Fox Sports consolidation and the online real estate business.
Shares in News Corp Limited
(ASX:NWS) closed up 8.20%.
The best and worst performers of the day
The best performing sector was Energy adding 280 points to close at 13,422. The worst performing sector was Telcos, losing 14 points to close at 1,741 points.
The best performing stock in the S&P/ASX 200 was Aurora Oil & Gas Limited
(ASX:AUT), rising 56.11 per cent to close at $4.09. Shares in Forge Group Limited
(ASX:FGE) and AWE Limited
(ASX:AWE) also closed higher.
The worst performing stock was Goodman Fielder Ltd
(ASX:GFF), dropping 3.76 per cent to close at $0.64. Shares in Virgin Australia Holdings Ltd
(ASX:VAH) and Westfield Group
(ASX:WDC) also closed lower.
Commodities
The price of gold is buying $US1,261 an ounce, and is up $16.82 over the week. Light crude is $0.46 lower at $US97.84 a barrel. The Australian dollar is buying $0.8942 and is $0.2X up over the week.
That’s the Market Wrap for 7 February. I’m Dallas Baird and thanks for joining me on the Finance News Network. We’ll leave you now with a look at the markets, have a great evening.
