Stocks edge up, energy eyed

The local sharemarket turned up at noon, as energy stocks pared early losses.

The Australian sharemarket turned higher at noon, reversing earlier losses as materials and energy stocks returned to the flatline.

At midday, the benchmark S&P/ASX 200 index inched up 9.5 points, or 0.18 per cent, to 5,237.4, while the broader All Ordinaries index lifted 10.5 points, or 0.2 per cent, to 5,321.5.

The big miners had underperformed in opening trade but soon found buying support, with Rio Tinto more than 1 per cent higher at noon.

Energy stocks also pared early losses, although downward pressure remained after oil prices tumbled close to 5 per cent during the offshore session.

As a sector, energy was down a slight 0.05 per cent.

“Oil will be front and centre in the Asian session today in the wake of the weekly EIA oil inventories report which drove declines in the US markets,” IG markets analyst Angus Nicholson said.

“Summer driving season in the US will end within the next two months, which is when demand for gasoline is at its highest, and yet gasoline inventories are not declining as expected.

“This is developing into a major concern for the oil market because once the seasonal demand disappears, gasoline inventories could be set to explode in the second half of the year.”

Mr Nicholson added investors would also likely be “nervous” during today’s session given key US jobs numbers are due out tonight.

Meanwhile, the big four banks were mixed as investors continued to ponder the possibilty of a ratings downgrade after yesterday’s outlook downgrade by Standard & Poor’s.

ANZ Bank was 0.82 per cent higher at $23.25, but Westpac dipped 0.3 per cent to $28.26. Commonwealth Bank and National Australia Bank treaded water, respectively eking out 0.01 per cent to $72.75 and 0.02 per cent to $24.28.