The Australian share market has made solid gains after a surge in energy stocks and improvements for the big banks turned around a mixed overnight lead out of the US.
The benchmark S&P/ASX200 index ended Friday up 31.3 points, or 0.51 per cent, at 6,121.4 points, as local investors turned bullish ahead of the February reporting season starting in earnest next week.
The index lifted 1.2 per cent for the week – its best performance since late December.
Citi director of equities sales Karen Jorritsma said strong business and consumer confidence, broad economic strength around the country and bullish offshore sentiment have provided positive sentiment for the local market.
“This is one of the first reporting seasons I can remember where we haven’t been inundated with earnings downgrades,” Ms Jorritsma said.
Energy stocks drove ASX gains on Friday after a survey showed that OPEC countries are sticking with commitments to restrict supply more than offset rising US oil production, which has hit 10 million barrels for the first time in almost 50 years.
Locally, Santos added 4.3 per cent to $5.37, Oil Search 2.9 per cent to $7.87, Woodside Petroleum gained 2.1 per cent at $34.24, and Origin Energy 2.2 per cent to $9.60.
Financial stocks gained ground after a midweek dip in the sector, with the big four banks up between 1.0 per cent and and 0.7 per cent.
Miners also lifted, with BHP Billiton up 0.5 per cent to $30.81, Rio Tinto found 0.7 per cent at $78.25, and the gold miner Newcrest added 1.1 per cent to $23.07
James Hardie shares surged $1.50, or 6.8 per cent, to an all time high of $23.65 after the building materials supplier conservatively upgraded the lower end of its full-year guidance and flagged improved earnings margins in its US business.
Ardent Leisure broke even at $1.985 after the entertainment operator announced it will take a $15 million to $25 million writedown on the value of its theme parks as crowd numbers remain low at the venues following the 2016 Dreamworld tragedy.
Telstra rose three cents, or 0.8 per cent, to $3.67 despite the telco giant announcing it will take a $273 million first-half impairment on its US video streaming business, Ooyala – a measure that cuts the value of the business to zero.
And shares in the poker machine supplier Aristocrat Leisure were one cent lower after the Federal Court ruled a former poker machine addict failed to prove that Aristocrat or Crown Resorts breached consumer laws.
Property trusts showed the heaviest losses on Friday as bond yields continue to rise worldwide.
The Australian dollar was struggling to keep its head above 80 US cents at 1630 AEDT, in the wake of a rise in US bond yields and a more confident picture for growth and inflation emerging from the US Federal Reserve.
The local currency was worth 80.01 US cents at 1700 AEDT, from 80.43 cents on Thursday.
ON THE ASX:
* The benchmark S&P/ASX200 index closed up 31.3 points, or 0.51 per cent, at 6,121.4
* The broader All Ordinaries index was up 31 points, or 0.5 per cent, at 6,229.8 points
* The SPI200 futures contract was up 35 points, or 0.58 per cent, at 6,071 points.
* National turnover was 3.6 billion securities traded worth $5.3 billion
CURRENCY SNAPSHOT AT 1700 AEDT ON FRIDAY
One Australian dollar buys:
* 80.01 US cents, from 80.43 cents on Thursday
* 87.74 Japanese yen, from 87.95 yen
* 64.03 euro cents, from 64.76 euro cents
* 56.12 British pence, from 56.68 pence
* 108.55 NZ cents, from 109.13 NZ cents
The spot price of gold in Sydney at 1700 AEDT was $US1,347.29 per fine ounce, from $US1,344.04 per fine ounce on Thursday.
BOND SNAPSHOT AT 1630 AEDT:
* CGS 4.50 per cent April 2020, 2.0041pct, from 1.9958pct on Thursday.
* CGS 4.75pct April 2027, 2.7837pct, from 2.7607pct.
Sydney Futures Exchange prices:
* March 2018 10-year bond futures contract at 97.17 (implying a yield of 2.83pct), from 97.195 (2.805pct), on Thursday.
* March 2018 3-year bond futures contract at 97.825 (2.175pct), from 97.835 (2.165pct).
(*Bond market closes taken at 1630 AEDT previous local session; currency closes taken from 1700 AEDT previous local session)