Local stocks surge on US stimulus
Local stocks surge on US stimulus

Australian stocks have continued to soar with risk assets posting gains following the announcement of fresh US Federal Reserve economic stimulus measures.

At 10.02am, the benchmark S&P/ASX200 index was up 44.9 points, or 1.03 per cent, at 4384.3 points, while the broader All Ordinaries index had risen 44.5 points, or 1.02 per cent, to 4404.3 points.

On the ASX 24, the September share price index futures contract was up 37 points at 4385 points, with 20,143 contracts traded.

City Index chief analyst Peter Esho said news that the Federal Reserve would introduce fresh stimulus measures had led to Australian shares soaring, particularly risk assets.

"It's very positive news for risk assets," he said.

"Our region has been underperforming for a fair while and we're now just playing catch-up."

The Federal Reserve overnight said it would buy $US40 billion of mortgage-backed securities a month, to push down long-term interest rates and stimulate growth.

The news prompted rises in stocks and commodity prices.

Locally, Discovery Metals was up 11 cents, or 9.91 per cent, to $1.22 due to rising copper prices.

Newcrest Mining was $1.55, or 5.86 per cent, up to $27.98 after gold prices rose to six-month highs on the Fed's announcement.

At 10.00am, the spot price of gold in Sydney was $US1,773.03 per fine ounce, up $US42.49 on Thursday's close of $US1,730.64 per ounce.

BHP Billiton was 55 cents higher at $33.33 and Rio Tinto was $1.47 up at $56.52.

The major banks were also higher.

ANZ was up 11.5 cents to $24.25, National Australia Bank was 15 cents higher at $25.43, Westpac had gained 37 cents to $24.17 and Commonwealth Bank had put on 14 cents to $55.16.

National turnover was 814.6 million securities worth $1.773 billion, with 554 stocks up, 233 down and 336 unchanged.

The West Australian

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