The bounce marks the first day of positive trading in 2016 following six straight sessions of losses in the new year.
At noon )AEDT), leading the gains are the telcos, financials and banks with Westpac and Commonwealth Bank ahead by almost 2 per cent.
Telstra has regained 1.8 per cent, while TPG is among the best performing on the market with a 4.5 per cent boost.
However the oil producers continue to hurt off commodity falls, with Santos tumbling more than 4 per cent and Oil Search down 2 per cent.
The miners are also in negative territory, with BHP Billiton off 0.7 per cent, and Rio Tinto down 1.65 per cent.
At 10.10am (AEDT) on Tuesday, the benchmark S&P/ASX200 index was up 26.5 points, or 0.54 per cent, at 4,958.7, while the broader All Ordinaries index was up 24.3 points, or 0.49 per cent, at 5,015.
On the ASX 24, the share price index was up 43 points at 4,909, with 12,884 contracts traded.
The Dow Jones industrial average and S&P 500 ended a volatile overnight session marginally higher following a late turnaround, but a drop in biotechs and energy shares kept a lid on the market.
Australian Stock Report head of research Chris Conway said the better performance from Wall Street overnight despite commodity price falls, including a fresh 11-year low for oil fuelled by Chinese growth concerns, was giving the ASX some hope.
“There are signs of life this morning,” he said.
“We saw a fairly strong fightback on Wall Street overnight with the S&P down more than one per cent at one stage to rally pretty hard near the close and to finish just in positive territory.”
The Dow finished 0.32 per cent higher at 16,398.57, and the S&P 500 was up 0.09 per cent to 1,923.67 while the Nasdaq Composite dropped 0.12 per cent to 4,637.99.
On the local share market, the big four banks were all higher with Commonwealth Bank up $1.51, or 1.92 per cent, at $80.15, National Australia Bank lifting 35 cents, or 1.28 per cent, to $27.77, ANZ gaining 22 cents, or 0.87 per cent, to $25.37, and Westpac 54 cents, or 1.77 per cent, better off at $31.10.
But the mining and energy sectors continue to suffer.
BHP Billiton was down 24 cents at $15.31, while Rio Tinto dropped 94 cents to $39.56 and Fortescue Metals was three cents lower at $1.61.
Woodside Petroleum was down 32 cents at $27.31, while Santos was down 15 cents at $3.06.
At 8.23am (AEDT) on Tuesday, the share price index was up 13 points at 4,879.
Locally, in economic news on Tuesday, the ANZ-Roy Morgan weekly consumer confidence survey is due out, as are the Australian Bureau of Statistics’ overseas arrivals and departure figures for November.
In equities news, Whitehaven coal is expected to issue its December quarter production report.
At 7am (AEDT) on Tuesday, the local unit was trading at 69.84 US cents, up from 69.66 cents on Monday.
Bank of New Zealand senior market strategist Kim Martin said the Aussie was buoyed after China guided the yuan higher for a second straight session on Monday, calming investor concerns about how far Beijing wanted to see the currency depreciate.
“It’s been quite a focal point, given there’s been a lot of volatility in Chinese markets and the currency,” she said.
“The Australian dollar reacted in a positive way.”
Martin said firming risk appetite on global markets also helped the Aussie.
“Things were a little more stable overnight. Equities were still down a wee bit but not as badly as recent past,” she said.
“Stability is a better environment for the Australian dollar to perform because it’s considered to be a risk-sensitive asset.”
World stocks fell to near two-and-a-half-year lows on Monday as a fresh battering for Chinese markets left Asia at a four-year trough and sent oil and commodity markets sprawling again.
NEW YORK – Wall Street has struggled for gains in volatile trading, weighed down by healthcare stocks and oil prices hitting fresh 12-year lows, ahead of the start of the US’ corporate earnings season.
Even strong December US non-farm payrolls data on Friday failed to boost investor optimism.
Nonetheless, the Dow and the S&P500 both finished in positive territory.
“None of us know what the future is, but given this moment, where we’ve gotten very conflicting data, it makes investors nervous,” said Kim Forrest, senior equity research analyst at Fort Pitt Capital Group in Pittsburgh.
“I think the final coup de grace is the Federal Reserve and its tightening phase has made them even more nervous.”
LONDON – Britain’s top share index has fallen to extend a four-day losing run after posting its worst first week of the year since 2000, hit by late falls in Shire and energy firms.
British-listed pharmaceutical firm Shire had a $US32 billion ($A45.95 billion) bid accepted for Baxalta International Inc, catapulting it to a leading position in treating rare diseases.
While traders said the deal made strategic sense, there was some wariness over the price offered.
China guided the yuan higher for a second straight session on Monday, calming investor concerns about how far Beijing wanted to see the currency depreciate.
However, with more weak data out of China over the weekend, copper sank to its lowest levels since 2009, and miners failed to hang on to early gains.
HONG KONG – Chinese markets suffered a fresh pounding leaving Asia at a four-year trough and sending oil and commodity markets sprawling again as doubts continue to mount about Beijing’s ability to manage the world’s second-biggest economy.
The absence of Tokyo for a holiday only made liquidity even harder to come by, heightening volatility.
Beijing was again the epicentre of unease as the People’s Bank confounded analysts by guiding the yuan’s midpoint rate sharply stronger, a move that might calm concerns about a competitive devaluation but only added to market confusion as to Beijing’s ultimate intent on its currency policy.
The move was an apparent reversal of the midpoint’s recent weakening trend which included the biggest one-day drop in the guidance rate in five months on January 7.
WASHINGTON – The US Supreme Court has rejected a bid by Nestle SA, the world’s largest food maker, and two other companies to throw out a lawsuit seeking to hold them liable for the use of child slaves to harvest cocoa in Ivory Coast.
LONDON – Six bankers have been formally charged in a British court with conspiring to manipulate Euribor benchmark interest rates, while another five accused in the case did not appear for the hearing.
HONG KONG – The biggest-ever Chinese acquisition of a German company has been announced, with a consortium led by state-owned China National Chemical Corp (ChemChina) buying industrial machinery maker KraussMaffei Group for about $US1 billion ($A1.43 billion).
ENERGY
Oil prices have plummeted to 12-year lows, with US crude futures falling to the lowest since late 2003, as traders cite fears over slowing demand in China and a growing inventory glut.
US crude prices fell 4.3 per cent to $31.72 a barrel, while benchmark Brent dropped five per cent to $31.83 a barrel.
“China has torpedoed the hopes of the optimists,” David Hufton, of oil brokers PVM Oil Associates, said in a note.
PRECIOUS METALS
Gold has retreated as the US dollar rose versus the euro, but the metal has held around a nine-week high as pressure on stock markets continues to support investors’ flight to safety.
“Some investors were anticipating that gold futures were slightly overbought after the run-up last week,” said Phillip Streible, senior commodities broker for RJO Futures in Chicago.
“Traders booked profits on that run-up to $USUS1,100, possibly to free up margins to support other positions that have recently been beat up but still have long-term prospects.”
BASE METALS
Copper prices have plummeted to their lowest in six-and-a-half years as large losses on Chinese equity markets reinforced tarnished prospects for growth and demand in the world’s biggest consumer of industrial metals.
Benchmark copper on the London Metal Exchange ended down 2.2 per cent at $US4,387 a tonne. The metal used in power and construction earlier touched $US4,381, its lowest since May 2009.
“China’s stock market and base metals are reflecting uncertainty about its economy,” Cantor Fitzgerald analyst Asa Bridle said.
“Sentiment is the driver, there’s no let-up. We can’t see anything at the moment that will come to the rescue for metals.”
ASX stocks to watch Tuesday, January 12
BHP – BHP BILLITON
FMG – FORTESCUE METALS GROUP
RIO – RIO TINTO
Iron ore prices continue to fall, dropping to $US40.90, close to the $US40 psychological level.
OSH – OILSEARCH
STO – SANTOS
WPL – WOODSIDE PETROLEUM
ASX-listed energy stocks could suffer on Tuesday as oil prices continue to slide closer to the $US30 mark.
WHC – WHITEHAVEN COAL: Whitehaven coal is expected to release its December quarter production report.
AAP
