Stockmarket rises sharply as banks rebound, aviation strengthens
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THE sharemarket rose sharply this afternoon after broker upgrades for Qantas and Virgin, while banks rebounded off yesterday's losses.
The benchmark S&P/ASX 200 index jumped 1.2 per cent to 4246.50, pulling the index to a 0.8 per cent gain so far this week.
“I don’t think there’s anything specific (driving the market) other than it’s been disappointing in recent weeks,” said Jamie Spiteri at Shaw Stockbroking.
“I think that most of our leading stocks have faltered because of poorer general sentiment. Uncertainty has filtered across our market (recently),” he added.
Sentiment brightened today after US stocks ended mostly higher overnight ahead of a two-day meeting on monetary policy at the US Federal Reserve.
Investors are looking for any hint of forthcoming changes to the central bank’s ultra-loose monetary policy, given recent data showing a strengthening economy. The Fed has pledged to keep its key rate on hold until late 2014.
Michael Derks, chief strategist at FxPro, noted: “The recent run of favourable data allows policy makers some breathing room. Some Fed officials have recently expressed reservations about how durable these green shoots of recovery will prove to be.”
Airlines were among the best performers in Australia today, spurred on by broker action.
Qantas shares rose 3.6 per cent after the company was upgraded to ‘outperform’ from ‘neutral’ by Macquarie. A similar Macquarie upgrade for Virgin Australia saw its shares climb 2.7 per cent.
Banks took back the previous session’s losses to notch weekly gains, as Westpac shares climbed 1 per cent and NAB gained 1.7 per cent.
ANZ shares were up 1.5 per cent and Commonwealth Bank shares climbed 0.9 per cent.
Metal firms were broadly higher as well after metal futures advanced in Asian electronic trading.
Rio Tinto climbed 0.9 per cent and BHP Billiton climbed 1.2 per cent. Steelmakers gained, with BlueScope Steel up 3 per cent while OneSteel shares were up 1.8 per cent.
Insurance group QBE jumped 4.1 per cent with Spiteri noting the firm’s shares “have been hit hard in recent times.”
“We’ve obviously got a bit of solid support across other Asian markets -- that’s coming across here today as well,” Spiteri added.
The Hang Seng Index gained 1.1 per cent in Hong Kong while the Nikkei Stock Average rose 0.9 per cent in Tokyo