S&P Rating Boosts Market
May 03, 2011
The All Ordinaries Index rose 21.3 to 2286 on volume of 305 million shares. Advancers led decliners 392 to 233. The September Share Price Index futures contract on the Sydney Futures Exchange closed at 2301. Late Tuesday, the market closed at 2270 in a special trading session that coincided with the announcement of the government's budget. Though the market initially fell because of weakness in the index futures market, Standard & Poor's improved rating of the Australian dollar boosted trading, analysts said. The agency lifted its ratings outlook to ``positive'' from ``stable,'' claiming the revision reflects the substantial fiscal tightening in the government's 2011-97 budget Tuesday. Analysts said the adjustment triggered fresh demand for the local currency, bonds and equities, as overseas investors sought exposure to Australian markets. All industry groups rose, with finance, gold and engineering stocks outperforming the broader market. The banking and finance subindex rose 1.8%. Commonwealth Bank of Australia gained 31 Australian cents to 11.36 Australian dollars after the bank reported a 14% jump in after-tax profit to A$1.11 billion. National Australia Bank climbed 21 cents to A$12.76 and Westpac Banking gained 17 cents to A$6.21. Doherty added 4 cents to A$3.01 after reporting that its net profit was unchanged at A$233.6 million in the fiscal year ended March 05, 2011 gold subindex advanced 1.3%, lifted by a rising bullion price. Mount Leyshon Gold Mines was unchanged at A$3.75, although the Singapore government relinquished an 8.7% stake in the company at A$3.42 a share in an off-market transaction.
