A 30-minute trading shutdown on the Australian sharemarket did little to cool a fresh bout of enthusiasm for the four major banks.
The S&P/ASX 200 index got off to a weak start but following the release of mixed lending and business data, the market rallied from unchanged to close 33.1 points, or 0.62 per cent, up at 5254.5.
The ASX paused the market for 30 minutes (between 2.15 and 2.45pm) to allow all participants to refresh their market data flow.
The ASX said some participant and vendor applications in a limited number of securities were not displaying accurate post-trade data, and while relatively minor overall, the exchange operators made the decision in the interests of fairness.
The overnight lead from Wall Street was a 0.2 per cent gain, but ANZ’s quarterly report beat forecasts after a drop in bad debt provisions, sparking 2 per cent average gains of the big four banks.
The rally was underpinned by a bout of US dollar weakness ahead of incoming US Federal Reserve chairman Janet Yellen’s speech tonight that lifted the Australian dollar to US90.10¢ and gold to a three month high of $US1285 an ounce.
Markets are expecting a “dovish”, market soothing outlook that will calm fears the Fed is intent on ploughing through with tapering of its bond purchasing program.
“We doubt the latest upswing in the AUD will last with levels above 90 seen as too high by the RBA and likely to dampen the recent lift in activity and confidence,” Royal Bank of Scotland currency strategist Greg Gibbs said.
“However, in the near term there is scope for a further rise in the AUD to squeeze out short positions; key will be the employment data on Thursday.”
The Shanghai composite index was up 0.4 per cent at the close of the ASX as money market rates eased.
Bloomberg reported that China’s banking regulator had ordered some of the nation’s smaller lenders to set aside more funds to avoid a cash shortfall.
Japanese markets were closed for a holiday.
Domestic sentiment was supported by a 2 point rise in the NAB business confidence index to 8 points while the banks ignored a 1.9 per cent drop in home loans in December that was supported by a 2.9 per cent surge in investment mortgage lending.
Gold broke to a fresh high amid reports Chinese demand had reached record levels and the country had probably surpassed India as the biggest bullion user according to the World Gold Council.
Copper dropped and spot iron ore eased to $US120.80 a tonne.
"Essentially the rise in the markets is because of the banks which have gone from strength to strength,” Bell Direct equities analyst Julia Lee said.
ANZ shares gained 65 cents, or 2.2 per cent, to $30.56.Commonwealth Bank, which will report its half year result on Wednesday, added $1.07 to $75.92, National Australia Bank gained 48 cents to $33.89 and Westpac was 46 cents higher at $32.23.
"If Commonwealth Bank can produce something along the lines of ANZ that would been seen as a huge positive,” Ms Lee said.
Other corporate updates were met with less enthusiasm.
Macquarie shares lost $2.10, or 3.8 per cent, to $53.52 after it maintained its financial forecasts, but said merger and acquisition activity was muted.
Shares in hearing implants maker Cochlear fell $5.21, or 8.9 per cent, to $53.68, after it reported a 73 per cent fall in its first half profit.
Engineering company Bradken was also weaker, with its shares down 49 cents, or 9.4 per cent, at $4.72 after its first half profit dropped by 18.5 per cent.
Among the big miners BHP Billiton added five cents to $36.55, Rio Tinto dropped 38 cents to $66.64 and iron ore miner Fortescue was five cents higher at $5.64.
The broader All Ordinaries index was up 30.8 points, or 0.59 per cent, at 5267.3.
The March share price index futures contract was 34 points higher at 5203, with 27,099 contracts traded.
National turnover was 1.9 billion securities worth $4.4 billion.