Strong finish: ASX up 1.19% on first trading day

Market Reports

by David Chau

It was a bull rush for investors today – being the first day of the trading year. The Australian share market jumped at the open and maintained its positive momentum all throughout, finishing the day 1.19% higher.

The local market was bolstered by news of strong manufacturing data from China, where its manufacturing PMI rose 1 point to 51.9 – which was its fastest pace in almost 6 years. This appears to have boosted the performance of Australian shares, sending the Australian dollar back above the US 72c mark.

Some of the biggest gains were seen in energy companies Woodside Petroleum and Beach Energy – both up at least 2%. This was boost was due to increasing oil prices since the start of the week, now that the agreement between OPEC and non-OPEC producers to cut oil production has begun.

At the close of trade, the S&P/ASX 200 index finished 67 points higher at 5,733 points.

The value of trades was $3.4 billion on volume of 490 million shares at the close of trade. The top three stocks by value were Commonwealth Bank (ASX:CBA), ANZ Bank (ASX:ANZ) and BHP Billiton (ASX:BHP).

On the futures market the SPI is 62 points higher.

Local economic news

Australia’s manufacturing sector performed strongly at the end of last year.

In December, the Australian Industry Group’s Performance of Manufacturing Index
rose 1.2 points to 55.4. This is the fastest pace of expansion since July, and the highest year-end reading since 2007.

Company news

Hills Ltd (ASX:HIL) has entered a contract with landscaping tools company, AMES Australasia. AMES will now manufacture and sell the Hills Home Living products range.  Previously, Woolworths operated the Hills Home Living business under a licensing agreement. However, the supermarket giant terminated the agreement after it withdrew from the home improvement business and closed its Masters stores. Hills is expecting its EBITDA for the first half of FY17 to improve under this new deal with AMES. Shares in Hills are down 7.61% to 42 cents.

ANZ Banking Group (ASX:ANZ) has sold its 20% cent stake in Shanghai Rural Commercial Bank for $1.84 billion.

Myer Holdings (ASX:MYR) is being sued by a former shareholder in a Federal Court class action, about statements it made in regards to its 2014 full-year results.

The US Food and Drug Administration (FDA) has approved Actinogen Medical’s (ASX:ACW) application to start a Phase II clinical trial of its Alzheimer’s disease drug, Xanamem.

Best and worst performers

The best performing sector was Utilities adding 1.83 per cent to 8,036. The sector with the least gains was Healthcare, gaining 0.66 per cent to 19,911 points.

The best performing stock in the S&P/ASX 200 was Aconex (ASX:ACX), rising 8.88 per cent to close at $5.52. Shares in Syrah Resources (ASX:SYR) and Whitehaven Coal (ASX:WHC) also finished higher.

The worst performing stock was Orocobre (ASX:ORE), dropping 3.53 per cent to close at $4.37. Shares in Evolution Mining (ASX:EVN) and iSentia Group (ASX:ISD) also closed lower.

Commodities

Gold is trading at $US1,158 an ounce.
Light crude is trading flat at $US53.72 a barrel.
The Australian dollar is buying $US0.7232.

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