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Aussie shares up as investors return for bourse bargains

Business

The Australian share market is up sharply as bargain hunters plough back in.

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Despite major sell-offs in the US and UK overnight, local investors are buoyed by the S&P 500 futures recovery in after hours trading and the local SPI futures finishing up by around 14 points as well, Commsec market analyst Tom Piotrowski said.

“The test will be in that window that proceeds the opening of the Chinese market,” Piotrowski said.

“If we get a sense that the rest of the region is going to get on board with this recovery then we’ll stand a better chance of sustaining the improvement that we’re seeing at the moment,” he added.

The Chinese market will open at 12.30pm (AEDT).

The benchmark S&P/ASX200 and the broader All Ordinaries indices are up 1.6 per cent and 1.5 per cent, respectively, after a late bounce in US trading.

The Dow Jones Industrial Average closed 1.6 per cent lower in a volatile session, and the benchmark FTSE 100 index closed down 3.5 per cent.

CMC Markets chief market strategist Michael McCarthy said the key for markets is whether last night the huge trading ranges and sharp turnaround represent a capitulation, or the beginning of a much deeper problem.

“The next 24 hours are crucial to the near and medium term outlook for markets,” he said in a research note.

Finance and resource stocks led the gains in early morning trade, with Insurance Australia up 20 cents at $5.17, Rio Tinto up $1.25 to $39.00 and Origin Energy up nine cents at $3.55.

In the financial sector, Macquarie Group was up $1.57 at $73.92.

The big four banks were all up, with Commonwealth Bank up $1.20 at $78.81, ANZ up 24 cents at $23.74, and Westpac up 44 cents at $30.50. National Australia Bank is 28 cents higher at $27.02.

Energy giant Woodside Petroleum is also getting a boost, up eight cents to $25.45, despite posting a sharp fall in revenue due to lower oil and gas prices.

AAP

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