CBA jump drives shares higher
Australian shares have closed slightly higher, driven by gains in the telecommunications and financial sectors.
But gains remained limited as concerns over Europe's debt woes and political uncertainty weighed.
The benchmark S&P/ASX200 index gained 11.9 points, or 0.3 per cent, to 4297, while the broader All Ordinaries index rose 9.2 points, or 0.2 per cent, to 4351.9.
The rise was driven by monetary easing in China, but the gains were held back by losses in the resources sector, IG Markets market strategist Stan Shamu said.
China’s central bank reduced its reserve required ratio - freeing up cash to lend - to stimulate the economy following disappointing import and export economic data last week.
‘‘There was a lift in risk assets early on, particularly in the resource space, but unfortunately through the day the uncertainty coming from Greece weighed on most of the risk assets,’’ Mr Shamu said.
New elections may have to be called in Greece, a prospect dreaded by the European Union as it could mean further delays to the country’s promised structural reforms.
CBA leads banks
High dividend paying bank and telco stocks performed well on the ASX.
Commonwealth Bank was the best performer of the big banks, up $1, or 1.9 per cent, to $52.40, ANZ was 16 cents higher at $22.20, National Australia Bank was 25 cents higher at $24.80. Westpac was 65 cents lower at $22.07 after it went ex-dividend.
The mining giants were mixed but the overall sector was down. BHP Billiton was firmer for most of the day, but edged off highs after an executive said he could not rule out a write-down of a shale gas assets.
BHP gained 9 cents, or 0.3 per cent, to $34.46, Rio Tinto was 7 cents weaker at $61 and Fortescue Metals was down 5 cents to $5.34.
Telstra extended its recent rally posting a 4 cent, or 1.1 per cent, gain to close at $3.64.
Weaker dollar helps
Also supporting local exporters was a dip in the Australian dollar to multi-month lows below parity, helping exporters such as blood products maker CSL to gain 1 per cent.
Rare earths producer Arafura Resources jumped 1.8 per cent after confirming it was talking with a range of
potential investors for its Nolans project.
Fertiliser and explosives maker Incitec Pivot climbed 0.3 per cent despite a 20 per cent fall in underlying earnings. The firm's explosives unit earnings surprised, vindicating expansion and lifting investor mood.
National turnover was 1.5 billion securities worth $4.1 billion, with 401 stocks up, 551 down and 426 unchanged.
BusinessDay, with wires