Stocks step up as gold miners shine

The ASX has extended Friday’s gains with gold miners leading the charge as Chinese markets return from holidays.

An electronic display at the Australian Securities Exchange. (AFP PHOTO/PETER PARKS)

The local sharemarket closed higher, recovering slightly after losses last week.

The benchmark S&P/ASX200 was up 28.6 points, or 0.5 per cent, at 5,739.3 points. The broader All Ordinaries index was up 27.7 points, or 0.48 per cent, at 5,805.1 points.

“What we’re seeing today is the expression of that confidence, now that Hong Kong, Shanghai are back from holidays and a lot of investors and traders who were away for school holidays have returned to their desks in Australia,” CMC Markets Chief Market Strategist Michael told The Australian.

He said last week’s falls were “curious” given the positive leads from global markets.

“The light volumes that we saw suggested that it was just a drift and that it had more to do with holidays than any concerns about the Australian economy,” Mr McCarthy said.

Commonwealth Bank gained 0.54 per cent, closing at $76.71. Westpac added 0.68 per cent to close at $32.36 and ANZ rose 0.75 per cent to finish at $29.70. NAB climbed 1.18 per cent to $31.71.

Listed gold miners were among the top performing stocks after an uptick in the price of gold following a month-long slide.

Newcrest Mining gained 1.02 per cent to $21.77, Northern Star rose 1.86 per cent to $4.93 and Sacarcen Mineral Holdings jumped 3.08 per cent to $1.34. St Barbara also added 3.08 per cent to $2.68.

Strength in iron ore miners faded, as iron ore futures fell as much 3 per cent.

BHP shed 0.19 per cent to $26.52, Rio Tinto edged 0.07 per cent lower to $69.20 and Fortescue fell 2.9 per cent to $5.02.

Mantra shares soared 16.41 per cent to close at $3.76 after the company confirmed a non-binding bid from Accor to buy the hotel chain for $3.96 a share.

Energy company WorleyParsons entered into a trading halt after it announced it had penned an agreement to purchase UK oil and gas company AFW for $303m. It also announced a $322m capital raising imitative to help fund he purchase, confirming that shares will remain halted until an outcome is reached. Worley shares were last trading at $14.24.

Woodside Petroleum dropped 0.62 per cent to $28.85 and Santos fell 0.98 per cent to $4.05. Oil Search strengthened 0.84 per cent to $7.21, while Origin Energy rose 0.14 per cent to finish at $7.09.

Mr McCarthy predicted the strength in the market today would continue through the week ahead, given the recent gains in global markets and today’s recovery.

“It’s a pretty data-free week, we’re a bit light-on for leads, so local sentiment is going to be very important not just today but throughout the week given the catch-up that we’re seeing in the region,” Mr McCarthy said.

“It looks at this stage like it will be a good one.”

The Australian dollar was trading broadly flat at US77.66 cents at 4.26pm (AEDT).