Shares have ended 0.4 per cent higher today, shrugging off a third consecutive rate rise by the Reserve Bank. At the close, the benchmark S&P/ASX200 index was up 17.7 points, or 0.4 per cent, at 4719, while the broader All Ordinaries rose 17.6 points, also 0.4 per cent, to 4733.1. Among the sectors, industrial stocks rose 1 per cent, materials gained 0.2 per cent, financials 0.4 per cent, while property trusts fell 0.3 per cent.

Australia’s central bank raised its benchmark interest rate by a quarter percentage point for an unprecedented third straight month as evidence mounts that the nation’s economy is strengthening. Reserve Bank Governor Glenn Stevens increased the overnight cash rate target to 3.75 percent from 3.5 percent. Stevens said today the bank’s three rate increases will “work to increase the sustainability of growth in economic activity and keep inflation consistent” with his target range of 2 percent to 3 percent “over the years ahead.”

The increase is the first time the central bank has raised borrowing costs at three straight meetings, boosting the rate from a half-century low of 3 percent. By contrast, officials in the U.S., U.K. and Europe have kept their benchmark lending rates at historic lows this year.

Development of Australia’s largest resource project has formally started today with a ground-breaking ceremony at Barrow Island for the $43 billion Gorgon gas project. Senior executives from Chevron, Shell and ExxonMobil, together with Premier Colin Barnett, federal Resources Minister Martin Ferguson, were on hand to officially kick-start the massive project. The operation is tipped to create more than 10,000 direct and indirect jobs and more than $33 billion is expected to be spent on local goods and services.

U.S. stocks rose on Monday, helping the Dow post its fifth straight monthly gain, on hopes that possible fallout from Dubai’s debt woes will be contained. Shortly before the market closed, Dubai’s largest company said its planned restructuring of some units involved $26 billion in debt, easing some concerns about the size of Dubai’s financial problems.

Retail shares limited the advance as investors worried that the holiday shopping season might have gotten off to a tepid start. Black Friday data suggested weak sales during retailers’ most imporant sales period and underscored concerns about the economy. Black Friday, or the Friday after the U.S. Thanksgiving Day holiday, is seen as the start of the U.S. holiday shopping period and buyers typically flood the stores that day searching for bargains.

The Dow Jones industrial average rose 34.92 points, or 0.34 percent, to end at 10,344.84. The Standard & Poor’s 500 Index was up 4.14 points, or 0.38 percent, at 1,095.63. The Nasdaq Composite Index was up 6.16 points, or 0.29 percent, at 2,144.60.

Source: Reuters, Fairfax, Bloomberg

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Shares have ended higher after picking up solid gains in late afternoon trading as investors snapped up banks and miners. At the close, the benchmark S&P/ASX 200 index was up 37.2 points, or 0.8 per cent, at 4722.2, while the broader All Ordinaries was 32.8 points higher, or 0.7 per cent, at 4741. Among the sectors, financials increased 0.9 per cent, while materials added 1.1 per cent, and energy rose 0.3 per cent. Gold miners sagged 0.4 per cent.

Gold rose to a record high above $US1175 today, the second time this week it has notched up a new high on solid investment sentiment and expectations of more gold buying by the public sector. A recent purchase of 200 tonnes of gold by India’s central bank sparked a rally that lifted the precious metal to successive record highs with it gaining about 12 per cent this month alone. The purchase was part of a planned sale of 403.3 tonnes by the International Monetary Fund. Russia, Sri Lanka and Mauritius have also since announced gold acquisitions.

Australia’s economy has entered a “new upswing” that will last for several years, helping the nation’s households fund mortgage costs, said Ric Battellino, deputy governor of the central bank. The currency rose as investors increased bets the Reserve Bank will raise interest rates next week for a record third month after Battellino told a conference in Melbourne today that it’s “reasonable to assume we will see this growth extended for a few more years yet.” A report published earlier today showed the number of jobs available for skilled workers rose 2.4 percent in November from October, adding to signs that the economy is strengthening.

U.S. stocks fell on Tuesday on lackluster economic data in a session marked by low volume and choppy trading, but losses eased after the Federal Reserve raised its expectations for growth in 2010. Stocks fell early in the session as revised government data on gross domestic product showed the U.S. economy grew at a slower-than-expected pace in the third quarter.

However, the downbeat mood was tempered after the Fed revised upward its growth expectation for 2010, while minutes of the FOMC’s most recent meeting showed officials are increasingly confident about a durable recovery for the U.S. economy. The U.S. stock market will be closed on Thursday in observance of Thanksgiving Day. On Friday, it will be open for only half a day due to the holiday.

The Dow Jones industrial average dropped 17.24 points, or 0.16 percent, to end at 10,433.71. The Standard & Poor’s 500 Index inched down just 0.59 of a point, or 0.05 percent, to 1,105.65. The Nasdaq Composite Index fell 6.83 points, or 0.31 percent, to 2,169.18.

Source: Reuters, Fairfax, Bloomberg

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Australian stocks gave up solid early days to end lower, led by a sharp turnaround for mining stocks. The benchmark S&P/ASX200 index reversed yesterday’s gains, losing 32 points, or 0.7 per cent, to close at 4685, while the broader All Ordinaries fell 31 points, or 0.7 per cent, to 4708.2. Among key sectors, materials stocks were down 0.9 per cent, financials were off 0.7 per cent and energy stocks were trading 0.4 per cent lower.

Woodside Petroleum Ltd. said it has kicked off Australia’s biggest drilling campaign to find fuel for its Pluto gas project off the country’s northwestern coast and is also negotiating supplies from other companies. Australia’s second-largest oil and gas producer plans to drill at least 20 wells through to 2011 to find gas for the venture, that is set to cost more than $10 billion. The program represents the biggest deep-water, continuous drilling campaign in Woodside and most likely Australian history, Peter Moore, senior vice president for exploration, said at an investors briefing today in Perth.

U.S. stocks snapped a three-day losing streak on Monday as stronger-than-expected home sales data fueled optimism while a weaker dollar boosted commodity-linked stocks. Sales of previously owned U.S. homes rose to their highest level in more than 2-1/2 years last month. That helped to ease concerns about the sector generated last week when another report showed housing starts fell sharply in October.

Monday’s data went some distance to reassure investors who have pared positions as they fret about the economy. Stocks rallied broadly, with all 10 S&P sectors showing strong gains. The Dow industrials reached a new 13-month high but volume was light, which some investors read as a lack of conviction.

The Dow Jones industrial average gained 132.79 points, or 1.29 percent, to end at 10,450.95. The Standard & Poor’s 500 Index rose 14.86 points, or 1.36 percent, to 1,106.24. The Nasdaq Composite Index added 29.97 points, or 1.40 percent, to close at 2,176.01.

The slide in the dollar helped lift commodity stocks as gold hit a record $1,170.55 an ounce and copper rose to levels not seen for 14 months, helped also by expectations of recovery.

Source: Reuters, Fairfax, Bloomberg

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The Australian sharemarket has closed 0.7 per cent higher, as gains in the mining and retail sectors offset weakness in some bank and energy stocks. At the close, the benchmark S&P/ASX200 index was up 31.2 points, or 0.7 per cent, at 4717, while the broader All Ordinaries gained 32.5 points, or 0.7 per cent, to 4739.2. Among the sectors, materials stocks rose 1.7 per cent, industrials gained 1.2 per cent, while financials slipped 0.1 per cent.

Stocks could sputter this week as volumes dry up in holiday-shortened trading and with a slew of economic reports likely to illustrate the recovery is still fragile. Investors will also get a glimpse of how holiday shopping could shape up with “Black Friday,” which traditionally marks the start of the season as retailers slash prices. It will be difficult for the economic recovery to make much headway without a pick-up in consumer spending as it accounts for two-thirds of the economy.

A raft of data is squeezed into the first half of the week, shortened by Thursday’s Thanksgiving holiday. The delicate nature of the recovery has analysts split on whether the economy will advance from here or still faces another leg down. Data has largely shown an economy that is recovering slowly but is still weak, particularly in areas like employment. Reports include home sales, consumer confidence, durable goods and the second reading of gross domestic product.

Platinum gained more than 1 percent on Monday, rising to its strongest level since September 2008 after gold rallied to a lifetime high on firm oil prices and worries about the economic outlook. Spot platinum jumped to $1,464.50 an ounce, up from $1,441 in New York on Friday. Platinum is used in autocatalysts to clean exhaust fumes and in jewellery.

Oil prices rose above $US78 a barrel on Monday as heightened tension between Iran and Western nations raised speculation over a potential supply risk, encouraging investors to push prices higher. Prices were also supported by a weaker US dollar, following dovish comments from US central bankers and a surge in gold to a new record after concerns over accelerating inflation and weak economic growth prompted investors to cut risk. Higher resource stocks helped boost Asian stocks.

US crude for January delivery rose 71 cents to $US78.18 a barrel in Asian trade. The December contract, which expired on Friday, settled down 74 cents at $US76.72 a barrel, weighed down by a stronger dollar and concerns about the energy demand outlook.

Source: Reuters, Fairfax

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Australian shares have posted modest losses for the week as banks and mining stocks slid on Friday. At the close, the benchmark S&P/ASX200 index was 63.4 points lower, or 1.3 per cent, at 4685.8, while the broader All Ordinaries was off 61.1 points, or 1.3 per cent, to 4706.7. The pull-back erased gains earlier in the week to leave the ASX200 down about 0.4 per cent – its third weekly decline in the past four weeks. Today, all sectors ended in the red, with materials stocks down 1.4 per cent, financial shares were off 1.5 per cent and industrials dropped 1.7 per cent.

Australia’s central bank should continue to lead the world in raising interest rates as its economic growth outpaces most other countries, the Organization for Economic Cooperation and Development said. The economy will expand 0.8 percent this year, accelerating to 2.4 percent growth in 2010 and 3.5 percent in 2011, the OECD forecast in its semiannual economic outlook released yesterday in Paris. The organization in June predicted Australia’s economy would shrink 0.4 percent in 2009 and expand 1.2 percent in 2010. Higher household confidence and iron ore exports to China will prompt central bank Governor Glenn Stevens to raise borrowing costs in December by a quarter percentage point for a record third month to 3.75 percent, analysts surveyed by Bloomberg predict.

Technology stocks drove a broad-based U.S. sell-off on Thursday as a brokerage took a dim view of demand prospects for the semiconductor sector, while economic data underscored the fragility of the recovery. Bank of America-Merrill Lynch cut its 2010 growth outlook for the semiconductor industry on concerns about a rising inventory glut. It downgraded 10 stocks, including Intel Corp, Texas Instruments Inc and Marvell Technology Corp. There was also more disconcerting news in housing. A record one in seven U.S. mortgages were in foreclosure or at least one payment was past due in the third quarter, according to fresh data signaling that the housing market’s recovery will be tepid at best.

The U.S. dollar’s gain was another headwind for stocks as it pressured prices of natural resources like crude oil and gold, pushing down shares of companies such as Alcoa and U.S. Steel Corp. The S&P materials index shed 1.5 percent as the U.S. dollar index rose 0.2 percent.

The Dow Jones industrial average shed 93.87 points, or 0.90 percent, to end at 10,332.44. The Standard & Poor’s 500 Index slid 14.90 points, or 1.34 percent, to 1,094.90. The Nasdaq Composite Index dropped 36.32 points, or 1.66 percent, to 2,156.82.

Source: Reuters, Fairfax, Bloomberg

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Australian shares hold on to modest gains as regional markets retreat. Banks and gold miners advance. In the final minutes of trading, the S&P/ASX 200 was up 9.6 points, or 0.2 per cent, to 4748.6 and the broader All Ordinaries index gained 6.9 points, or 0.1 per cent, at 4766.5. Major indexes across the region were lower, with Japan’s Nikkei 225 down about 1.5 per cent. On a sector-by-sector basis, materials advanced 0.4 per cent while gold stocks added 0.9 per cent and financials rose 0.7 per cent.

BHP Billiton chief executive Marius Kloppers says his company is cautious about the global economy and that restocking in developed nations has been lethargic. “We remain cautious on the global economy in the short to medium term,” Mr Kloppers said yesterday at a meeting at the Lowy Institute.

Mr Kloppers says there has been strong demand recovery in the resources sector, mainly driven by restocking in China, but this could be drawing to an end. “As GPD (gross domestic product) growth picked up, the Chinese economy had to increase its working capital in order to support this increasing economic activity,” Mr Kloppers said.

“The increase in working capital has a once-off impact on demand and we are now witnessing the end of that working capital build in China.” He said BHP Billiton had expected a similar restocking exercise would be required in Organisation for Economic Co-operation and Development countries, but this has been slow to start.

Oil traded near $80 a barrel in New York after rising yesterday as a government report showed U.S. crude and fuel supplies dropped along with refinery production and imports. Oil gained 0.6 percent yesterday and touched $80.33 after the Energy Department said crude inventories declined 887,000 barrels to 336.8 million last week. Stockpiles were forecast to increase by 300,000 barrels, according to a Bloomberg News survey of analysts. Fuel supplies fell as refiners operated at the slowest pace in more than a year.

U.S. stocks broke three days of gains on Wednesday following worrisome outlooks from two major software makers and a surprising drop in home construction last month. But stocks sharply cut the session’s losses just before the closing bell as many investors pointed to a strong uptrend in equities that have pushed major indexes to 13-month highs in recent days. The S&P 500 has ended down only three times in the last two weeks.

The government said housing starts declined to their lowest level in six months, weighed down by a sharp fall in construction activity for both single-family and multi-family dwellings, a sign the housing market is still under pressure. While the decline in new construction raised concerns about the recovery, it could bode well for removing remaining inventory from the market, something analysts say must happen for the housing sector to recover.

The Dow Jones industrial average dropped 11.11 points, or 0.11 percent, to 10,426.31. The Standard & Poor’s 500 Index dipped just 0.52 of a point, or 0.05 percent, to finish at 1,109.80. The Nasdaq Composite Index lost 10.64 points, or 0.48 percent, to end at 2,193.14.

Source: Reuters, Fairfax, Bloomberg, AAP

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The Australian stock market ended 0.5 per cent lower, after profit-taking in the financial sector eroded earlier gains. At the close, the benchmark S&P/ASX200 index was up 25.8 points, or 0.5 per cent, at 4729.42, while the broader All Ordinaries rose 23.6 points, or 0.5 per cent, to 4750.2. Among the sectors, financial stocks fell 1.5 per cent, industrials were down 1.1 per cent, while materials stocks rose 0.6 per cent.

The Australian dollar weakened from near the strongest level in 15 months after minutes from the central bank’s most recent meeting cast doubt on a third- straight increase in key lending rates. Australia’s central bank says the pace of interest-rate increases is an “open question” as it balances the risk of keeping borrowing costs too low against an economy that may cool as government stimulus abates. “In considering the pace of that adjustment, members were conscious of balancing risks,” officials said in minutes released today of their Nov. 3 meeting, at which they became the first central bank to raise borrowing costs twice this year.

The need for greater global currency stability means the world can no longer rely, as it has done since the end of the gold standard, on a currency issued by a single country, the head of the IMF said on Tuesday. Dominique Strauss-Kahn, managing director of the International Monetary Fund, restated his view that a new global currency might evolve out of the Special Drawing Right, the Fund’s in-house unit of account. That probably has to be a basket,” Strauss-Kahn said of the eventual replacement for the U.S. dollar. “In a globalised world there is no domestic solution,” he told a forum.

U.S. stocks rose broadly on Monday, sending indexes to fresh 13-month closing highs, after Federal Reserve Chairman Ben Bernanke reinforced expectations that interest rates would stay low to spur growth. Bernanke repeated that the Fed was likely to keep interest rates exceptionally low for “an extended period,” a pledge that weighed on the U.S. dollar and drove investors to snap up shares of natural resource companies as prices of global commodities – from gold to wheat – shot higher. In a speech before the Economic Club of New York, Bernanke said the recovery would not be as robust as previously hoped, and rising unemployment and tight bank lending were significant headwinds.

In the last hour of trading stocks briefly pared gains as Meredith Whitney, a prominent analyst, said in a CNBC television interview the stock market run-up was not supported by fundamentals. The Dow Jones industrial average gained 136.49 points, or 1.33 percent, to 10,406.96. The Standard & Poor’s 500 Index shot up 15.82 points, or 1.45 percent, to 1,109.30 – its first close above the psychologically important 1,100 level for the first time since October 2008. The Nasdaq Composite Index jumped 29.97 points, or 1.38 percent, to 2,197.85.

Source: Reuters, Fairfax, Bloomberg

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Australian shares held on to gains, with strong advances for mining and energy stocks. The benchmark S&P/ASX200 index closed 48.8 points, or 1 per cent, higher at 4755.2 points, while the broader All Ordinaries index was up 51.2 points, or 1.1 per cent, to 4773.8 points. Materials stocks gained 3.1 per cent while energy stocks were 2.1 per cent higher. Financial stocks were off 0.5 per cent.

Gold prices hit a fresh record high, exceeding their highs marked last week, as investors continued to seek bullion’s appeal as a hedge against the dollar’s weakness and inflation risks. Spot gold stood at $US1123.40 after rising as high as $US1126.30 per ounce, a record, compared with the notional New York close of $US1118.50.

The manager of two of the world’s largest commodities funds expects continued growth in the sector in 2010, with rising numbers of company mergers. Evy Hambro, a London-based portfolio manager who manages the BlackRock World Mining Fund and the Gold & General Fund, on Monday gave journalists in Australia an upbeat assessment of the sector following last year’s collapse in prices.

Mr Hambro said the rapid rise of China, which accounted for about 40 per cent of demand in almost every commodity, and above 50 per cent in some during the second quarter of 2009, was a key reason commodities prices would continue to rise.

The U.S. dollar drifted lower in Asia on Monday, heading into a week that is likely to see increased rhetoric on currencies from both China and visiting U.S. President Barack Obama. The United States and China sparred over exchange rates at a meeting of Asia Pacific leaders on Sunday, a move that quashed speculation China may allow some further yuan appreciation in coordination with Obama’s first trip to Beijing.

That could lead to some short-covering in the euro/yen pair later in the session, traders said. The euro had fallen in the previous session against the Japanese currency after shorts had been initiated on the hopes that a rising yuan will take some pressure off the euro. Market talk has been swirling that a rising yuan would lift other currencies across the region and take some of the upward pressure seen in the euro against the U.S. dollar.

Source: Reuters, Fairfax, AAP

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Asian stocks gained, driving the MSCI Asia Pacific Index higher for a fourth day, after a bigger- than-estimated increase in Japan’s machinery orders, while China’s industrial production and retail sales accelerated. Kubota Corp., Asia’s largest maker of tractors, increased 3.6 percent as orders for Japanese machinery rose 10.5 percent in September. Nippon Telegraph & Telephone Corp., Japan’s largest fixed-line phone operator, gained 4.7 percent as Goldman Sachs Group Inc. recommended investors buy the stock. HSBC Holdings Plc jumped 4.1 percent in Hong Kong after saying third- quarter profit was ahead of expectations.
U.S stocks closed mostly lower on Tuesday as differing views on whether the market can build on recent gains stalled the S&P 500’s six-day winning streak. The Dow industrials eked out a small gain to set a fresh 13-month high as cautious statements on the economic outlook from several Fed officials underscored the belief that easy monetary policy will remain intact well into next year.
The Dow Jones industrial average gained 20.03 points, or 0.20 percent, to end at 10,246.97. The Standard & Poor’s 500 Index shed 0.07 of a point, or 0.01 percent, to 1,093.01. The Nasdaq Composite Index dropped 2.98 points, or 0.14 percent, to close at 2,151.08.
Volume was light on the New York Stock Exchange, with 1.07 billion shares changing hands, below last year’s estimated daily average of 1.49 billion. On the Nasdaq, about 2.01 billion shares traded, below last year’s daily average of 2.28 billion.
 
Source: Reuters, Fairfax, Bloomberg

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The share market rose more than 1 per cent today, as investor spirits lifted further following another strong session on Wall Street. The benchmark S&P/ASX200 index was up 58.7 points, or 1.3 per cent, at 4733.6 points, while the broader All Ordinaries index rose 57.5 points, or 1.2 per cent, to 4744 points. Gains were across the board with most Asian markets up over 1 per cent following on from yesterday’s gains. Among the sectors, materials gained 1.9 per cent, financials rose 1 per cent and energy shares climbed 1.5 per cent.

Australian business confidence rose in October to near its highest level in almost six years, increasing the central bank’s scope to raise borrowing costs in December for a record third straight month. The sentiment index climbed 2 points to 16, after falling 4 points in September, according to a National Australia Bank Ltd. survey of more than 400 companies questioned between Oct. 25 and Oct. 30, and released in Sydney today.

A figure above zero shows optimists outnumber pessimists. Rising business and consumer confidence, as exports to China help the nation’s economy rebound from the global recession, were among reasons Reserve Bank Governor Glenn Stevens raised the benchmark interest rate by a quarter percentage point in October and this month to 3.5 percent.

Australian companies have raised a record amount of equity this year – almost three times the annual rate of the past few years and have looked to alternative sources of funds in response to the global financial crisis, a senior Reserve Bank of Australia official (RBA) says. RBA head of domestic markets department John Broadbent says the ratio of debt to equity in the corporate sector has been declining, with intermediated debt being replaced by a big increase in equity raisings.

‘‘Listed corporates have raised a record amount of equity this year, totalling some $60 billion, with issues broadly based across all sectors,’’ Mr Broadbent said today. ‘‘This compares with an annual average of around $20 billion in the three years prior to the financial crisis.’’ Mr Broadbent said most of these equity raisings had been used to pay down debt, with some companies explicitly saying the funds raised were to repay bank loans.

A broad U.S. stocks rally sent the Dow industrials to a 13-month high on Monday, after the Group of 20 pledged to keep aid flowing to the world economy, strengthening investors’ desire for risk. The agreement by G20 finance ministers and central bankers over the weekend to keep stimulus in place boosted global stocks on the expectation of prolonged low interest rates. The U.S. dollar briefly fell to a 15-month low, bolstering commodity prices and materials stocks.

The Dow Jones industrial average .DJI jumped 203.52 points, or 2.03 percent, to 10,226.94. The Standard & Poor’s 500 Index .SPX rose 23.78 points, or 2.22 percent, to 1,093.08. The Nasdaq Composite Index .IXIC gained 41.62 points, or 1.97 percent, to 2,154.06.

Lower interest rates worldwide make investing in risky assets like stocks more attractive, and reduce the cost of corporate financing used for investment.

Source: Reuters, Fairfax, AAP, Bloomberg

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