Market Wrap: Aus shares lift into new week

Market Reports

by Lelde Smitts

After dropping over last week positive offshore leads lifted the Australian share market into the third week of the New Year. Stocks traded in positive territory throughout the session, buoyed by the strength in the banking and energy sectors. 

The S&P/ASX 200 index added 10 to finish at 4,720.

The value of trades was $2.7 billion on volume of 557 million shares at the close of trade. The top three stocks by value were BHP Billiton Limited (ASX:BHP), Westpac Banking Corporation (ASX:WBC) and National Australia Bank Limited (ASX:NAB).

On the futures market the SPI is 8 points higher.

Economic news

Inflation rose in line with expectations last month. The TD Securities-Melbourne Institute inflation gauge rose 0.4 per cent in December 2012 from the month before and was up 2.4 per cent from the year before, suggesting the Reserve Bank of Australia [RBA] has scope to cut rates in needed. 

Home loan demand has fallen despite expectations last year’s RBA rate cuts would produce a rise: The Australian Bureau of Statistics has shown the number of home loans granted dropped 0.5 per cent to 46,199 and total housing finance by value fell 0.8 per cent to $21.464 billion in November 2012. 

Job advertisements in Australia fell to a three year low at the end of 2012. ANZ Banking Group (ASX:ANZ) has reported job ads dropped for the tenth straight month, down 3.8 per cent in December from the month before and 16 per cent down from the year before. 

Company news

BlueScope Steel Limited (ASX:BSL) has announced production and job cuts as part of a restructure to generate cost savings. The company will cut another 170 jobs at its Western Port steel mill in Victoria and lower production levels in mid-March. Shares in BlueScope Steel gained 0.27 per cent today, ending at $3.71. 

AJ Lucas Group Limited (ASX:AJL) jumped after confirming its British share gas exploration affiliate, Cuadrilla Resources, is in talks for the possible development of its assets. Mining services company AJ Lucas says there is no certainty its 41 per cent owned Cuadrilla Resources will reach a deal. The speculation has surfaced one month after Britain lifted a ban on controversial shale gas exploration. AJ Lucas Group jumped 13.35 per cent today, closing at $2.08. 
Macmahon Holdings Limited (ASX:MAH) lifted after Indian-based Sembawang walked away from a bid to buy its construction assets, leaving Leighton Holdings Limited (ASX:LEI) as the sole bidder.
Sedgman Limited (ASX:SDM), soon to be known as MDM Engineering Group, rose after inking a engineering, procurement and construction contract for African Barrick Gold PLC (LON:ABG) in Tanzania.
Nexus Energy Limited (ASX:NXS) dropped as the oil and gas explorer advised it has suspended production at its Longtom operations in Victoria due to an electrical fault.
Altona Mining Limited (ASX:AOH) fell after explorer revealed global miner Xstrata PLC (LON:XTA) will not exercise its option to buy a 51 per cent interest of Altona’s Roseby Copper Project in Queensland. 

Best and worst performers

The best performing sector was utilities adding 90 points to close at 5,343.
The worst performing sector was health care, losing 4 points to close at 11,514 points.
The best performing stock in the S&PASX 200 was Bathurst Resources Limited (ASX:BTU), rising 7.79 per cent to close at $0.42. Shares in Aquila Resources Limited (ASX:AQA) and Iluka Resources Limited (ASX:ILU) also closed higher.
The worst performing stock was GWA International Limited (ASX:GWA), dropping 6.25 per cent to close at $2.25. Shares in McMillan Shakespeare Limited (ASX:MMS) and Maverick Drilling and Exploration Limited (ASX:MAD) also closed lower. 

Gold is trading at $US1,664 an ounce.
Light crude is $0.58 higher at $US94.14 a barrel.

The Australian dollar

The Australian dollar is buying $US1.055. 

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