The Australian share market marked a new four-and-a-half year high this morning, boosted by another round of well-received corporate earnings and strength on most Asian markets.
At lunchtime the ASX 200 was 28 points or nearly 0.6% stronger at 5062, a level last seen in September 2008, the month that Lehman Brothers filed for bankruptcy. The financials sector spearheaded the rally, rising 1.1% as BEN recorded a net profit of $189.4 million. Also strong were consumer discretionary stocks +1.2%, IT +1% and consumer staples +0.7%.
There were significant gains in BSL, PBG, CCV, AHE, AMC, FGE and SFH after reporting earnings this morning. Gold stocks endured a horror morning, slumping 4.4% after the price of gold dipped below US1,600 an ounce on Friday. Spot gold rebounded $6.80 this morning to US$1,617.10 an ounce.
"At the moment, the Australian market is focused on our company profits," RBS Morgans senior equities adviser Tony Russell told Fairfax. "It's continuing the strong performance of last week despite more subdued markets overseas."
Most Asian markets kicked higher as Japanese exporters benefitted from a falling yen and Chinese markets re-opened after the week-long Lunar New Year holiday. Shanghai rallied 0.19%, Hong Kong's Hang Seng dropped 0.1% and Japan's Nikkei jumped 1.98%. Dow futures were recently up one point or less than 0.1%.
Crude oil futures dropped 37 cents this morning to US$95.71 a barrel. The dollar was buying $US1.0288.
Capitulation among gold stocks? Certainly some savage sell-offs this morning. I took advantage of lows in SLR, MML and KCN. Successfully in the case of the former two, less so with the latter, so far at least. Also caught SRX for a bounce. Pretty good start to the week, although once again by a tendency to buy too early on Mondays - need to work on that. Recognising your faults is they key to longevity in this game.
