Australian shares jump to two-month high
Australian stocks surged 1.7% today to a two-month high on hopes the European Central Bank (ECB) may announce further economic stimulus in December, lifting share markets around the world.
The S&P/ASX 200 index added 83.39 points, or 1.6%, over the week to end Friday at 5,351.6, its highest close since 19 August. It was also the first time the index closed above 5,300 since that date.
Positive news flows from the ECB overshadowed news on Monday that China’s third-quarter economic growth was the slowest in more than six years.
“There was a shortage of major economic news in Australia this week. The market tends to look favourably upon stimulus [such as the ECB’s] speculation.
“The economic news in China actually didn’t hit the market that hard this week. Its economic growth weakened but was largely expected,” said CommSec market analyst Steven Daghlian.
The market’s next main focus will be on the US Federal Reserve’s October meeting and the release of the nation’s gross domestic product data.
Investors may also pay attention to profit results from a few of the major Australian banks such as NAB and ANZ, Daghlian said.
“There really isn’t a whole lot of data out next week in Australia to move the needle, so the focus will be offshore,” he said.
Most sectors gain
All sectors in the ASX 200 except materials stocks increased this week, with gains led by consumer staples companies, which advanced 2.94%, and telecommunications stocks that rose 2.41%.
The S&P/ASX 200 Energy Index climbed 2.35% over the week, with Drillsearch Energy, Santos and Beach Energy among the top risers.
Drillsearch jumped 22.4%, while Beach Energy gained 4.6%, after the oil and gas producers announced a $1.2bn merger plan.
Santos surged 16.6% after the company rejected a non-binding takeover proposal from private equity firm Scepter Partners.
Wesfarmers, Ten rise
Wesfarmers, which owns retail brands like Bunnings and Coles, increased 3.1% to $41.73, after reporting higher first quarter retail sales from a year earlier.
Ten Network added 2.6% to 19.5 cents after it received clearance from the Australian Competition and Consumer Commission for its proposed stake purchase deal with Foxtel.