The Australian share market has hit its highest point in more than two months as good signs from the United States offset weaker local economic forecasts from the federal government.
The benchmark S&P/ASX200 index jumped 55.3 points, or 1.1 per cent, to 5116.8, while the broader All Ordinaries index gained 51.6 points, or 1 per cent, at 5098.7.
The S&P/ASX200 index posted its tenth consecutive day of gains and rose 1.5 per cent for the week, taking it above 5100 points for the first time since May 22.
The main local economic news was negative, as the forecast for the federal government’s budget deficit widened, and its outlook for unemployment and economic growth worsened.
But that was not enough to deter the positive vibe among investors, who were buying on the back of positive economic data from the US, including a strong manufacturing index and a drop in jobless claims.
IG market strategist Evan Lucas said more positive job numbers in the US on Friday night, Australian time, could lead to an all-time record eleventh day of gains for Australia’s top 200 companies.
The S&P 500 broad stock index in the US is currently at an all-time high.
‘‘We have been up five out of the last six weeks so it has been a very strong period even though we haven’t seen it because it’s been very gradual,’’ he said.
The big miners performed strongly, with BHP Billiton gaining 58 cents to $35.75 and Rio Tinto added $1.37 to $59.31. Both have rallied of late, suggesting investors were confident they would deliver strong profits during the coming earnings season.
The big four banks all traded higher, with Westpac the standout gaining 59 cents, or 1.9 per cent, to $31.46.
Gold stocks lost nearly 4 per cent with investors losing confidence in the sector amid weak prices and high costs.
Goldminer Regis Resources was the worst performer among the top 100 stocks, down 5.1 per cent to $3.37.
BusinessDay with agencies