Aussie shares are lifting for a third day, with the ASX 200 index up 22pts or 0.3 per cent to 6672.3 at lunch. Thanks to gains across most sectors, the local market remains near 11.5 year highs and continues the solid start to the new financial year.
Iron ore and gold miners are standing out thanks to strong gains in both commodities overnight. Iron ore rose by 4.1 per cent or $5 to US$126.20/t on supply concerns. Gold remains near six-year highs, lifting by 1.3 per cent to US$1408/oz.
Woolworths (WOW) is one of the strongest performers at lunch, lifting by 3.5 per cent. The supermarket chain operator said it will merge its liquor and pubs business in preparation for the $10bn spinoff of the combined division next year. WOW owns Dan Murphy’s and BWS businesses.
CIMIC (CIM) is up 1.4 per cent after signing a new five-year deal to carry out maintenance work for Sydney Trains. The engineering group expects the contract to help boost revenues by around $630m.
Energy stocks are holding back the market due to a near 5 per cent slide in oil prices overnight. OPEC and allies wrapped up a two-day meeting in Vienna and while an agreement was reached to extend supply cuts through to March 2020, the cuts were not as deep as some anticipated.
The Reserve Bank cut interest rates for a second straight month on Tuesday to a record low 1 per cent. RBA Governor Philip Lowe followed this up with a speech last night which signalled the bank is likely to keep rates on hold for a few months. Governor Lowe however has kept the door open for further reductions if needed to help bring down
unemployment and boost inflation. Bank stocks are coming under pressure for the second day as profit margins worsen on lower rates.
National Australia Bank (NAB) and Macquarie (MQG) are paying out $3.5bn in dividends today. NAB pays out 83c per share and $3.60 per share for MQG.
1.2bn shares have changed hands so far today worth $2.3bn. 584 stocks are up, 386 down and 321 are unchanged.
Published by CommSec