The West

The Aussie sharemarket is higher mid-session.
The Aussie sharemarket is higher mid-session.

The Australian sharemarket extended its recovery after weak Chinese growth data revived hopes for stimulus in the world's second biggest economy

Following the 0.7 per cent gain on Wall Street the S&P/ASX 200 index was up 0.3 per cent, but it bounced to close 32.1 points, or 0.6 per cent, up at 5420.3 as Chinese growth over the past year slowed to 7.4 per cent but beat expectations of 7.3 per cent.

The detail, however, showed the Chinese economy decelerated to an annual rate of just 5.6 per cent in the March-quarter while nominal growth - not including the inflation adjustment - slumped to 7.9 per cent.

Westpac senior economist Huw Mckay said this was the slowest period of growth in China since 1999, with the exception of the GFC period.

The Shanghai composite index was up 0.4 per cent at the close of the ASX as stimulus hopes offset the weak earnings environment.

In Tokyo the Nikkei index jumped 2.7 per cent as the yen fell on reports the Japanese government would cut its growth forecast for the first time in 18-months. Investors hope the Bank of Japan will be forced to increase its already hefty stimulus measures and that would further weaken the yen.

Overnight the S&P 500 fell almost one per cent by midday on rising tensions in Ukraine and a drop in the Empire state manufacturing index but there was no obvious catalyst for the rebound to a 0.7 per cent gain except for the Japanese growth news.

The weaker yen and gave fresh impetus to traders that use the weak yen as a cheap funding currency for so-called "carry trades" to chase high yielding assets.

A bout of US dollar strength knocked metals and the Australian dollar which lost US0.3¢ to US93.60¢, while Australian government 10-year yields lost 2.8 points to 3.965 per cent.

Gold had a choppy overnight session, slumping $US35 to $US1285 an ounce, and was trading at $US1297/oz at the close of the ASX.

Copper tumbled 1.5 per cent to $US6570 a tonne and spot iron ore was marginally firmer at $US117.10 a tonne.

More to come…

The West Australian

Latest News From The West

The victim of the Carlisle siege is suing the estate of the man who took her hostage at knife-point in a bid to get compensation for the permanent injuries she suffered during the deadly police …

Qantas and the operators of Perth Airport are poised to strike a deal within days to allow the first non-stop flights from Australia to Europe through the airline’s domestic terminal.

The children of Perth’s most recent fatal shark attack victim have broken their silence to reveal they want people to be put first to stop other families suffering the pain inflicted on their …

Popular videos