Stocks close firmly in the black

The local market has extended gains in afternoon trade, on the back of the BoJ’s policy tweaks.

The Australian sharemarket has ended sharply higher, after a modest morning rise accelerated in the afternoon, thanks to a largely market-friendly policy update from the Bank of Japan.

At the closing bell, the benchmark S&P/ASX 200 index had jumped 36 points, or 0.68 per cent, to 5,339.6, while the broader All Ordinaries index climbed 32.1 points, or 0.59 per cent, to 5,429.4.

Chief market analyst at CMC Markets, Ric Spooner, said a host of policy tweaks from the BoJ left a positive impression for traders as it moved in line with Europe’s “whatever it takes” approach.

“Keeping QE in place until inflation gets above 2 per cent removes speculation that the program might end before inflation is under control,” he said.

“The bottom line, QE is likely to last longer. The amounts involved will be flexible and aimed at targeting a long term bond rate.”

The focus now quickly shifts to a policy update from the US Federal Reserve, due out before the start of trade on Thursday.

Traders again noted no lingering effects from Monday’s ASX outage as the bourse operator’s chief executive Dominic Stevens returned to the group’s Sydney headquarters on Wednesday, ahead of a report on the glitch being released later this week.

Through the session the telecommunications sector lagged as the broadband space remained in the firing line.

TPG Telecom shed a further 7 per cent and rival Vocus Communications tumbled 9.9 per cent as margin pressure fears gathered steam.

More than $3.2 billion has been stripped from the combined valuation of the two companies across two sessions.

The energy sector led the way for much of the day, in direct contrast to yesterday, as oil prices steadied.

Santos bounced 1.7 per cent to $3.59, Origin rallied 2.5 per cent to $4.87 and Woodside was broadly flat at $26.78.

The big miners also saw a steady bid as base metals extended their recent ascent, with BHP Billiton tacking on 0.5 per cent to $20.72 despite news of a growing tax fight with the ATO and Rio Tinto lifting 0.8 per cent to $47.65.

Iron ore miner Fortescue bucked the trend in skidding 1.4 per cent to $4.89.

The big banks ended sharply higher, extending gains throughout the session.

ANZ outperformed with a gain of 1.7 per cent, while CBA trailed its peers in rising 0.4 per cent.

Among other blue chips, Telstra gained 0.8 per cent to $5.05, while Qantas rebounded 0.6 per cent to $3.17.

Elsewhere, Nufarm surged 4.6 per cent to $8.71 after comfortably beating analysts’ earnings projections, while Kathmandu advanced 1 per cent as it booked a profit jump and detailed plans for further overseas expansion.

Meanwhile, the Australian dollar edged up to US75.6c, gaining US0.15c through the local trading day.