Reuters: Hot Stocks: Australian shares rally on strong commodities, high yields

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Australian shares rally on strong commodities, high yields Apr 26th 2013, 01:43 Thu Apr 25, 2013 9:43pm EDT (Adds details, comments, stocks on the move) SYDNEY, April 26 (Reuters) - Australian shares rose 0.6 percent on Friday as strong metals prices boosted miners and Wall Street's gains lifted broader sentiment following positive weekly U.S. jobless data as investors continued to buy into high-yielding banks and telcos. Blue chip miners BHP Billiton Ltd and Rio Tinto Ltd rallied 3.2 percent and 3.4 percent, respectively. Gold miners were also firmer. Newcrest Mining Ltd jumped 6.1 percent while Regis Resources Ltd soared 12.6 percent. Copper rose to a one-week high on Thursday on signs of industry restocking in top consumer China, while gold surged 2.5 percent as physical buyers scooped up the metal at prices viewed as a bargain after bullion hit a two-year low on April 15. "I can definitely expect to see recent buying momentum continue and wouldn't be surprised to see the Australian market break the 52-week highs today," said Tim Radford, global analyst at Rivkin. The S&P/ASX 200 index climbed 32 points to 5,134.4 by 0122 GMT, its highest point since March 12, when the index hit an intra-day high of 5,163. The benchmark rallied 1.7 percent on Wednesday to finish at a 5-week high. Trading was closed on Thursday for the ANZAC day public holiday in Australia and New Zealand. Financials were mostly stronger, Westpac Banking Corp and Australia New Zealand Banking Group added 1.1 percent and 0.9 percent, but top lender Commonwealth Bank of Australia bucked the trend, losing 0.4 percent. Top telecommunications provider Telstra Ltd rose 0.7 percent. "A large portion of these gains is due to the strong demand for yield in Australia at the moment," Radford said. An inflow of capital due to offshore demand from Japanese institutions and insurance firms to Australia's high-yielding shares in telcos and banks has helped lift the market in recent sessions, he noted. "Yield outside of Australia has been pushed quite low." Dividend yield on average for the big four banks is 5.2 percent, compared to between 3-4 percent yields for 12-month maturity depositor accounts. Telstra currently yields 5.7 percent. Other defensives were weaker, capping broader gains. Biotechnology company CSL Ltd plumbed 1.4 percent while consumer retail staples Wesfarmers Ltd was trading flat and rival Woolworths Ltd was down 0.4 percent. U.S. stocks rose on Thursday, lifted by stronger-than-expected earnings and a large drop in weekly jobless claims. The S&P 500, up for five straight sessions, traded within a point of its record closing high before shedding about half of the day's gains. The high was near the 1,593 level that is expected to be technical resistance. New Zealand's benchmark NZX 50 index rose 0.5 percent or 21.1 points to 4,560.1, a record high. STOCKS ON THE MOVE * Graincorp Ltd rallied 7.6 percent to a record high of A$12.77 after the company agreed on Friday to a revised A$3.0 billion ($3.1 billion) bid from U.S.-based agricultural giant Archer Daniels Midland Co, ceding control of Australia's largest independent grains handler after a six-month courtship. (0119 GMT) * Acrux Ltd soared 16.2 percent to A$4.01 after the pharmaceutical company announced quarterly sales for the drug Axiron were strong. (0119 GMT) * ResMed Inc lost 1.3 percent to A$4.44 despite the sleep disorder equipment company posting a record revenue for the March quarter of A$374.35 million ($383.6 million). (0120 GMT) * Range Resources Ltd plunged 20.7 percent to A$0.05 after director Peter Landau announced its merger with International Petroleum. (0121 GMT) (Reporting by Thuy Ong; Editing by Jacqueline Wong) Link this Share this Digg this Email Reprints

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