Market Wrap: Aus shares sustain gains

Market Reports

The Australian share market opened 0.6 per cent higher and traded in a narrow range, closing up 0.5 per cent. Developments in Europe continued to dominate headlines, with Italy’s debt concerns now the focus. At home the federal government’s landmark carbon tax legislation has been passed by the Senate, paving the path for the implementation of the national carbon pricing scheme from July 1, 2012. 

The S&P/ASX200 index gained 20 points to finish at 4,294. On the futures market, the SPI is 8 points higher.

Economic news

The Australian Bureau of Statistics has reported that Australia's trade surplus narrowed in September, missing expectations for a rise. The balance on goods and services came in at a seasonally adjusted surplus of $2.564 billion.

National Australia Bank's monthly business survey revealed business conditions softened last month, but confidence rose. In October, conditions pulled back 3 index points to minus 1, while confidence rose 3 points to plus 2 index points.

Company news

Commonwealth Bank of Australia (ASX:CBA) has warned funding costs could rise as Australia grapples with the impact of the European debt crisis. Speaking at the company’s annual general meeting chairman David Turner told shareholders that even on an optimistic outlook it is unlikely the region will return to accelerating growth in the near future. Outgoing CEO Ralph Norris told shareholders the bank is well positioned to weather the challenges. Shares in Commonwealth Bank of Australia closed 0.73 per cent higher at $47.68.

Shares in Fairfax Media Limited (ASX:FXJ) fell to one of the worst performers of the S&P/ASX200, after the company priced its initial public offering for its New Zealand Trade Me online auction business. Trade Me has been priced at $NZ2.70, valuing the auction site at around $900 million. Fairfax expects to receive around $280.5 million from the IPO, to be lodged with regulators in the next two days. Shares in Fairfax Media fell 3.23 per cent before closing at $0.90.

Shares in Newcrest Mining Limited (ASX:NCM) rose after the gold producer announced it has raised $US1 billion in corporate bonds, its first such offering in the US. 

Shares in G8 Education Limited (ASX:GEM) jumped to one of the best performers in the All Ords Index after the child care operator said it has bought six childcare centres in Queensland for $8.2 million and confirmed it expects to deliver an annual net profit of $12.79 million.

Shares in Galaxy Resources Limited (ASX:GXY) continued to climb today, one week after the lithium producer announced its Chinese project was on track for completion. Galaxy today told the Australian Securities Exchange it is not aware of any other reason for the price change and increase in volume.

Shares in Carbon Energy Limited (ASX:CNX) responded positively to the carbon tax announcement. The company describes itself as Australia's leading carbon offset supplier through planting Australian native trees to absorb carbon dioxide.  

Best and worst performers

Most sectors finished in positive territory: The best performing sector was Health Care, rising 79 points to close at 7,793. The worst performing sector was Consumer Discretionary, falling 8 points to close at 1,251 points.

The best performing stock in the S&P/ASX200 was Aquila Resources, lifting 6.91 per cent to close at $6.65. Shares in Persues Mining and Murchison Metals also finished stronger.

The worst performing stock was Myer Holdings, dropping 4.12 per cent to close at $2.33. Shares in Goodman Fielder and Energy Resources of Australia also retreated.

Commodities

The price of gold is $US1,792 an ounce.
Light crude is down $0.02 at $US95.50 a barrel.