Australian shares join Asian market recovery
Australian shares have continued to gain ground as Asian markets recover from two days of heavy falls.
Photo: AAP/David Moir
The benchmark S&P/ASX200 stock index was up 1.3 per cent at 5,906.8 points at 1200 AEDT, regaining some of the ground lost from its 4.7 per cent drop over Monday and Tuesday that wiped $99 billion from the market’s value.
Asian shares are also rebounding, with Japan’s Nikkei more than three per cent higher, Korea’s Kospi up 1.3 per cent, and MSCI’s index of Asia-Pacific shares outside Japan had gained 0.5 per cent.
The relative calm follows a volatile session on Wall Street that ended with the Dow Jones Industrial Average 2.3 per cent higher, while the S&P 500 gained 1.7 per cent.
CMC Markets chief market analyst Ric Spooner said the recovery reflects the view that the economic outlook remains favourable ahead of the corporate earnings reporting season.
“The extent of the stock market fall in recent days will have created significant value in the eyes of some investors, warranting continued buying into higher levels,” he said.
“At the same time, concern will remain elevated after the recent big moves.”
Gains were led by mining stocks, with energy, financials and health care also contributing to the recovery.
BHP Billiton and Fortescue Metals were each more than two per cent stronger, and Rio Tinto was 3.3 per cent higher ahead of the release of its annual results later on Wednesday.
Santos and Woodside Petroleum were each around two per cent stronger.
Commonwealth Bank was relatively steady after announcing a two per cent decline in half-year profit to $4.7 billion, as it set aside cash for potential penalties in its Federal Court battle with AUSTRAC.
Westpac, National Australia Bank and ANZ were all trading less than one per cent higher.
Carsales.com was down 3.4 per cent despite posting a 27 per cent increase in half-year profit, and construction giant CIMIC had jumped 5.5 per cent after it boosted its dividend following annual profit growth of 21 per cent.
The Australian dollar is also recovering after its recent falls, as risk appetite returns to currency markets, to be trading just under 79 US cents.
– AAP
