Resource stocks have steered the Australian share market higher for the first session in four in cautious trade as a cyclone bears down on Queensland.
At lunchtime the ASX 200 was ahead 8 points or 0.2% at 4762. Resource sectors accounted for most of the gains, with energy up 1%, metals & mining +0.8% and materials +0.8%. Financials were flat and most of the defensive sectors were lower.
"The markets hate uncertainty and we've just gone through a major flooding event in Queensland that has impacted particularly on coal exports and other general economic activity," RBS Morgans Ipswich manager Tony Russell told Fairfax. "We've got a major [cyclone] system moving in here and investors are just probably saying we may as well sit on our hands until we know what the upshot will be."
Business confidence slumped in December as floods ravaged Queensland. The NAB business confidence index dipped to -3 in December from 6 the previous month, the first contraction since April 2009. In response, NAB has cut its growth outlook for the economy from 3.6% to 2.4%.
China's official manufacturing purchasing manager's index came in marginally weaker than expected, easing from 53.9 to 52.9. Asian markets followed Wall Street's positive overnight lead. Japan's Nikkei rallied 0.33%, Shanghai 0.03% and Hong Kong's Hang Seng 0.02%. Dow futures were recently at +16.
Crude oil futures rallied 10 cents this morning to $91.97 a barrel. Spot gold picked up $3.60 to $1,335.60 an ounce. The dollar was buying 99.88 U.S. cents.
Best wishes to any HotCopperites in Queensland battening the hatches ahead of Cyclone Yasi. You blokes have been through enough. Slow start at this trading desk but the action picked up mid-morning with scalps in GSC, TUC and ADO. Also picked up GNS and could use another cent or two recovery there.
