australian stocks rally for the sixth consecutive session to end at seven week high 1733982015

Australian stocks chalked up their sixth consecutive day of gains, in the process scaling the technically significant level of 5,700 on the S&P/ASX 200 index, and closing at a seven-week high.

Supermarkets and banks led from the front while mining stocks were a drag given the sharp drop in global gold prices. Though the S&P/ASX 200 jumped higher on open, it repeatedly met selling pressure and finally bottomed out shortly after noon, at which point a rally commenced. Significantly, this was just after the release of the minutes of the RBA’s July meeting, which did not, however, contain anything new.

Indices and sectors

The benchmark S&P/ASX 200 rose 19.8 points, or 0.3 per cent, and closed at 5,706.7, while the broader All Ordinaries index was up 19.5 points, or 0.3 per cent, at 5,688.5.

The top gaining sectors were information technology (+1.19 per cent), healthcare (+0.82 per cent), consumer staples (+0.71 per cent), consumer discretionary (+0.70 per cent) and financials (+0.47 per cent). Materials (-0.32 per cent) and industrials (-0.01 per cent) were the only two losing sectors.

Stocks

Toll road developer and operator Macquarie Atlas Roads Limited (ASX:MQA) was the top gainer on the S&P/ASX 200, up 5.41 per cent to AU$3.31, after it declared that revenue during the June quarter rose 4.2 per cent compared to the prior year period, while weighted average traffic increased just 3 per cent, indicating higher average toll rates and therefore better profitability.

Mining companies were mostly down. BHP Billiton Limited (ASX:BHP) fell 0.63 per cent to AU$26.82, Rio Tinto Limited (ASX:RIO) slid 0.91 per cent to AU$53.38 and Fortescue Metals Group Limited (ASX:FMG) was down 0.29 per cent to AU$1.74. Gold miner Newcrest Mining Limited (ASX:NCM) fell 1.52 per cent to AU$11.69 as gold prices slumped to a five-year low.

Energy stocks ended mixed. Woodside Petroleum Limited (ASX:WPL) was unchanged at AU$34.78, Origin Energy Ltd (ASX:ORG) fell 0.44 per cent to AU$11.20, and Santos Ltd (ASX:STO) dipped 0.93 per cent to AU$7.47. However, Oil Search Limited (ASX:OSH) jumped 3.88 per cent to AU$7.22, and was one of the top gainers on the S&P/ASX 200 after the company recorded its highest ever quarterly production during the second quarter and boosted its production forecasts for the full year of 2015.

Commonwealth Bank of Australia (ASX:CBA), which fell 0.29 per cent to AU$88.10, was the only loser amongst the big four banks. National Australia Bank Ltd. (ASX:NAB) was up 0.96 per cent to AU$34.77, Australia and New Zealand Banking Group (ASX:ANZ) gained 0.61 per cent to AU$33.05 and Westpac Banking Corp (ASX:WBC) was up 0.87 per cent to AU$34.90.

Retailers had a good day with most stocks in the sector ending in the green except Myer Holdings Ltd (ASX:MYR), which fell 1.59 per cent to AU$1.24. While Wesfarmers Ltd (ASX:WES), the owner of supermarket chain Coles, gained 0.72 per cent to AU$42.22, Woolworths Limited (ASX:WOW) was up 0.63 per cent to AU$28.76, Caltex Australia Limited (ASX:CTX) surged to 1.07 per cent to AU$34.98 and Metcash Limited (ASX:MTS) gained 1.32 per cent to AU$1.15.

Economic news, currency and market outlook

The ANZ-Roy Morgan consumer confidence index jumped 4.5 per cent to 111.8 points during the week ended July 19, sharply better than the 3.6 per cent fall seen during the previous week, as consumers fretted less about the collapse in Chinese stocks and welcomed the resolution of the debt crisis between Greece and its international creditors.

According to analysts, the big four banks may be forced to raise mortgage lending rates by as much as 0.65 percentage points due to the increased cost of raising capital to comply with the change in APRA’s home loan rules, according to ABC.

On Wall Street Tuesday, stocks closed lower after weak results from International Business Machines Corp. (NYSE:IBM) and United Technologies Corporation (NYSE:UTX) dragged down the indices. The Dow Industrials declined 181 points, or 1 per cent, to 17,919. The S&P 500 slipped 9 points, or 0.4 per cent, to 2,119, while the Nasdaq Composite shed 11 points, or 0.2 per cent, to 5,208.

The Australian dollar is trading higher against the US greenback which has seen profit-taking from traders in the absence of significant market moving data, according to the Business Spectator. At 06:30 this morning (AEST) the local currency was trading at 74.25 US cents, up from 73.58 US cents on Tuesday.

The Australian stock market is likely to open lower today given that at 06:59 am (AEST) this morning the September ASX SPI200 Index (AP) Futures was down 28 points at 5,618.