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Australia shares break resistance at 4,400 to hit 10-day high
November 22, 2012 / 6:56 AM / 5 years ago

Australia shares break resistance at 4,400 to hit 10-day high

By Miranda Maxwell
    MELBOURNE, Nov 22 (Reuters) - Australian shares rose 1
percent to their highest close in 10 days on Thursday, breaking
above key resistance at 4,400 as data showed China's
manufacturing at its strongest in over a year.
    It was the biggest one day percentage gain since Oct. 2,
when the central bank last lowered interest rates to stimulate
the non-mining parts of Australia's economy. The Chinese figures
followed an overnight report showing U.S. manufacturing in
November grew at its quickest pace in five months.
    "Investors finally had enough conviction to push local
equities higher ahead of China's HSBC flash manufacturing PMI,
which some anticipated would finally show strong signs of
recovery," said Stan Shamu, strategist at IG Markets. 
    "Investors are also realising that apart from Europe, the
rest of the world seems to be in a better place economically,"
he said.
    In a broad rally, the benchmark S&P/ASX 200 index 
rose 43.6 points to 4,413.1, according to the latest data. The
index, which last closed above 4,400 on Nov. 12, fell 0.4
percent on Wednesday, breaking two days of gains.
    New Zealand's benchmark NZX 50 index rose 0.7
percent to 3,997.2.  
    Sentiment for riskier assets was also boosted by a ceasefire
between Israel and Gaza's Hamas rulers and by hopes that
emergency aid to Greece will soon be released.
    "Any positive news of a Greek settlement can only add to the
current optimism and help cement our index above the
4,400-mark," said Ben Taylor, trader at CMC Markets.
    The China HSBC Flash Manufacturing Purchasing Managers Index
(PMI) rose to a 13-month high of 50.4 in November, the latest
indicator of recovery in Australia's top export market.
    BHP Billiton ended up 1 percent and top banks
gained, led by a rise of 1.4 percent in Commonwealth Bank of
    Notable movers included BlueScope Steel which
rallied 11 percent to A$0.50 after targets presented to an
investor briefing surpassed analysts' expectations.
    Lynas Corp jumped 7 percent to A$0.675 after its
first shipment of rare-earth concentrates arrived in Malaysia,
indicating an imminent start of operations at its $800 million
plant. The plant has been embroiled in disputes with local
residents since construction began two years ago.
    Surfwear retailer Billabong International climbed
6.6 percent to A$0.89. The Australian Financial Review said
Billabong was mulling a possible float of its e-commerce
businesses valued at up to A$300 million.
    Goodman Fielder rose 2.6 percent to a A$0.60 after
the food and ingredients company said it would review its
dividend policy at the half year and was aiming to cut its cost
base by A$100 million ($103 million) by 2015. The stock had
slumped to as low as A$0.372 in January. 
    Among defensive stocks, Telstra Corp added 1.9
percent to A$4.27, its best close since December 2008.
    But St Barbara Ltd fell 5.8 percent to A$1.62 after
it lowered gold production forecasts.   

 (Editing by Edwina Gibbs)

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