Geopolitical risks and another bout of weak Chinese data kept a lid on the Australian sharemarket but volume well below average allowed the bulls to keep the market in the black.
The S&P/ASX 200 index traded in a narrow range before closing 20.6 points, or 0.37 per cent, up at 5587.1, the high of the day, as miners lost ground and investors delivered a negative response to National Australia Bank’s quarterly earnings update.
Investors mostly shrugged off a 17 per cent fall in Chinese foreign direct investment and “visibly weak” Chinese housing data that threatened growth targets in the world’s second biggest economy.
The Shanghai composite index was up 0.3 per cent at the close of the ASX as stimulus hopes were stoked by data that showed the broad house price weakness in China’s 70 major cities as 88 per cent, or 64 cities saw declining prices.
“Developers continue to discount aggressively to clear their stock on hand and sellers are maintaining abundant supply in the secondary market,” Westpac Chian economist Huw McKay said.
“Both the new and secondary markets are now recording a greater breadth of price declines than at the trough of the previous cycle.
In Tokyo the Nikkei index was marginally firmer.
The Australian dollar was steady at US93.20¢ but government 10-year bond yields tumbled five points to 3.338 per cent after global safe-haven demand was stoked by the disputed reports that Ukraine had destroyed a Russia armoured vehicle.
St Louis US Federal Reserve president James Bullard did his best to persuade markets they were wrong on pricing in such a weak growth scenario but his comments were ignored.
Global benchmark US Treasury bond yields tumbled 10 points to a low 2.30 per cent, before settling five points down at 2.35 per cent while German two-years traded below zero per cent and German 10-years dropped below one per cent.
Mr Bullard said global benchmark US treasury bond yields tumbled five points to a month low of 2.35 per cent while German two-years traded below zero per cent and German 1o-years dropped below 0ne per cent.
He said the market was trading “too dovishly compared to the committee. I think that’s probably a mistake”.
On Friday, equity sentiment was knocked by falls in US consumer confidence and the Empire Manufacturing survey while producer and consumer price inflation met forecasts.
Spot iron ore rose 0.2 per cent to $US93.40 a tonne on Friday while Dalian iron ore futures were off 0.4 per cent today.
Gold lost $US5 to $US1300 an ounce while copper climbed 0.8 per cent to $US6885 a tonne.
IG market strategist Stan Shamu said the local bourse lifted today, following positive moves on the US futures market and despite some mixed company earnings reports locally.
"The main thing is the US futures bounced back straight from the open this morning - that gave us a bit of room to move,” Mr Shamu said.
"From an earnings perspective, it’s actually been fairly mixed.
"But the fact that we’re going into some big dividends tomorrow, particularly Commonwealth Bank, has really helped underpin the market."
BHP Billiton pushed higher ahead of its financial results tomorrow.
"It’s a situation where I think people are just reluctant to sell, heading into some big results,” Mr Shamu said.
Among the major banks, according to preliminary figures, National Australia Bank fell 47 cents to $34.22 as it warned it faces another STG245 million ($A447.20 million) hit from its troubled UK business.
Westpac was up 16 cents at $34.25, ANZ lifted 16 cents to $32.55, and Commonwealth Bank firmed 20 cents at $81.40.
In the resources sector, global miner BHP Billiton added 10 cents at $39.15, and Fortescue Metals nudged up one cent to $4.52.Rio Tinto gained six cents to $65.35.
Rio is considering the future of its key stake in a company that has lost the right to mine in Bougainville.
Gold miner Newcrest fell nine cents to $11.11 after it posted a $2.2 billion full year loss because of $2.4 billion in asset impairments, mainly on its Lihir operations in Papua New Guinea.
Among other stocks, protective gloves and condom maker Ansell rose 82 cents to $19.81 as it said it expects acquisitions and changes to its business to start showing benefits in fiscal 2015.
Australia’s largest freight operator, Aurizon, reversed 15 cents to $4.88 after it posted a 43 per cent fall in full year net profit on the back of previously announced impairments.
The broader All Ordinaries index was up 21 points, or 0.38 per cent, at 5580.6 points.
The September share price index futures contract was up 25 points at 5531 points, with 19,935 contracts traded.
Preliminary national turnover was 1.7 billion shares worth $3.08 billion.