ASX rallies towards six-year high
The Australian sharemarket rallied towards its six-year high as tensions eased in Ukraine and investors wagered on a market friendly speech from US Federal Reserve chairman Janet Yellen at the annual Jackson Hole conference on Friday.
Following a strong overnight session the S&P/ASX 200 index climbed 36.7 points, or 0.66 per cent, to 5623.8 on a high volume rotation to miners led by BHP Billiton ahead of its earnings report and news of its restructuring.
Investors ignored soft iron ore prices and Chinese stocks and also looked on the bright side of the Reserve Bank's August monetary policy meeting minutes that "highlighted uncertainty" in the domestic economy.
Westpac economist Mathew Hassan said the word "uncertainty" was absent from the July minutes but was used several times this month, including in reference to key points such as the growth outlook.
Bu he said the Reserve was "a very long way from acting on its concerns".
The Australian dollar rose US0.2¢ to US93.40¢ while government 10-year yields climbed 6.8 points to 3.414 per cent.
The Shanghai composite index remained out of step with global markets and was off 0.1 per cent at the ASX having earlier fallen 0.5 per cent as stimulus hopes eased.
The Shanghai market was supported by a surge in media stocks after President Xi Jinping said the nation would build a few media groups into influential content providers.
"(Chinese) Officials have repeatedly delivered economic slowdowns that were more severe than they intended, forcing them to subsequently re-stimulate the economy," Lombard Street Research analyst Dario Perkins wrote in a report. "The latest 'go' phase for growth reflects another mini official stimulus, together with an improvement in exports. While stronger growth can continue in the short term, we think the economy faces serious macroeconomic challenges over the next 3-5 years."
In Tokyo the Nikkei index was up per cent.
Spot iron ore eased to $US93.30 a tonne yesterday while Dalian iron ore futures fell 0.6 per cent.
Copper rose 0.5 per cent to $US6905 a tonne while gold was steady at $US1300 an ounce.
More to come…
