The Australian sharemarket finished a volatile session in the black as Ukraine jitters eased and the Reserve Bank signalled a long period of steady interest rates.
The S&P/ASX 200 index twice rallied to 0.5 per cent, gains but finished 19.2 points, or 0.35 per cent, up at 5481.4 on low volumes as investors searched for buying catalysts.
The Australian dollar was unusually calm following the Reserve’s decision to leave the cash rate on hold at 2.5 per cent, but a belated spike to US93.15¢ soon reversed to leave the dollar slightly weaker at US92.80¢.
Forex.com analyst Chris Tedder said he expected rate to start rising early next year but the biggest threats to this outlook appeared to be dangers from offshore, a growth-restricting budget from Canberra, a lack of growth in non-resource parts of the economy and the possibility of a stronger exchange rate.
Underscoring this point, the ANZ-Roy Morgan consumer confidence index fell 4.2 per cent to 106.3 in the week ending 4 May.
“Confidence is now down a sharp 8 per cent over the past fortnight; a large move for the index,” the survey reported.
“This is most likely to have been driven by policy leaks in the lead up to the May 13 Federal budget.”
Government 10-year yields dipped 2 points to 3.852 per cent, ignoring the 3 point rise in US 10-years to 2.61 per cent.
Australian Bureau of Statistics data released today showed total household debt stood at a 25-year high of $1.84 trillion at the end of 2013, equivalent to $79,000 for every person living in Australia, but the pace of growth slowed to 2 per cent between 2007 and 2013.
Domestic growth sentiment was tempered by a drop in the trade surplus to $731 million, down from the previous $1.25 billion and short of forecasts for $1 billion.
The Shanghai composite index was up 0.3 per cent at the close of the ASX after money market rates eased following the long weekend while Japanese markets were closed for a public holiday.
Overnight US and European stocks reversed steep opening falls to finish marginally higher as Ukraine tensions eased and the US ISM manufacturing index beat forecasts at 55.2 points.
Investors shrugged off a cut in the eurozone 2015 growth forecast from 1.8 to 1.7 per cent and in the region’s inflation rate to 0.8 per cent from 1.2 per cent.
Gold, was steady at $US1309 an ounce, copper jumped 1.1 per cent to $US6720 a tonne and spot iron ore eased 0.1 per cent to $US105.90 a tonne.
The Reserve Bank’s decision to leave rates on hold momentarily weighed on the market, but it did not have a large impact, Bell Direct equities analyst Julia Lee said.
A late surge in prices then saw the main indices close 0.35 per cent higher.
"It’s been a quiet session with Korea, Hong Kong and Japan on holidays, but most sectors are trading in the black,” Ms Lee said.
"The only sector that’s down is the property sector."
Healthcare stocks were among the strongest performers, with blood plasma producer CSL adding 79 cents to $69.64 Sonic Healthcare gaining 17 cents to $17.82.
Three of the major banks rose, with Westpac adding 24 cents to $34.69, ANZ gained 11 cents to $34.08 and Commonwealth Bank was 35 cents higher at $79.29.
But National Australia Bank dropped nine cents to $34.11.
Miners were also mixed, with BHP Billiton up 17 cents at $37.66, Rio Tinto down 15 cents at $61.50 and Fortescue Metals six cents weaker at $4.80.
The broader All Ordinaries index was up 19.3 points, or 0.35 per cent, at 5462.7.
The June share price index futures contract was 14 points higher at 5469, with 13,423 contracts traded.
National turnover was 1.5 billion securities worth $3.3 billion.