The West

Market set for modest gains
Market set for modest gains

UPDATE 7.25am: The Australian sharemarket opened higher on fresh hopes that US political leaders may work together to avoid sending the economy off the fiscal cliff.

At 7.21am, the benchmark S&P/ASX200 index was up 21 points, or 0.48 per cent, at 4357.8, while the broader All Ordinaries index was up 19 points, or 0.44 per cent, at 4379.1.

On the ASX 24, the December share price index futures contract was up 20 points at 4368, with 7614 contracts traded.

IG Markets analyst Stan Shamu said the Australian market had opened strongly after the US staged a recovery amid some constructive fiscal cliff negotiations.

The fiscal cliff refers to the huge tax hikes and spending cuts that will come into force on January 1 if Republicans and Democrats do not reach a compromise.

“We did take a bit of a positive lead from the close of the US session,” he said.

“We did see a pretty strong recovery in the US after there was some optimism around US fiscal cliff negotiations between the Republicans and the Democrats.”

The Dow Jones Industrial Average finished up 45.93 points (0.37 per cent) at 12,588.31.

In Europe on Friday, London's benchmark FTSE 100 index of top companies closed 1.27 per cent to 5605.59 points lower and Frankfurt's DAX 30 index slid 1.32 per cent to 6950.53 points, the first time it has closed below 7000 points since September 5.

Locally, resources stocks were performing strongly.

BHP Billiton surged 43 cents to $33.36, Rio Tinto was up 17 cents to $57.07 and Fortescue gained two cents to $3.92.

At 7.36am Billabong shares were up 9.5 cents, or 12.84 per cent, to $83.50 after the head of the retailer's US business Paul Naude said he was considering taking control of the company.

The four major banks also had a positive opening.

ANZ was up eight cents to $23.74, National Australia Bank was 12 cents to $23.32, Westpac gained seven cents to $24.49 and Commonwealth Bank added 24 cents to $58.52.

At 7.39am, national turnover was 321 million shares worth $423 million, with 350 shares up, 218 down and 257 unchanged.

The West Australian

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