Local shares jumped out of the block to start the week up 0.7% by lunch Monday as the miners showed strength, supported by modest gains from the financial stocks. The advance consolidated gains from the first week of the year as the index inches towards the psychological 5,000-point barrier.
At midday, the All Ords was up 32.7 to 4,984.9, while the ASX/200 gained 34.1 to 4,946.2. About 1 billion shares worth around $1.3 billion had changed hands.
Investors in the Materials and Resources sector focused on positive notes made by brokers on their European and Asian peers, helping the sector up 1.8% by lunch.
The gains came despite widespread declines in base metal prices in London on Friday.
Australia’s largest company, BHP Billiton, climbed 1.5% to $44.26, while Rio Tinto put on 79c, or 1% to $79.80. Rio shares have not been worth more than $80 each since September 2008.
Fortescue bounced back from a bout of profit-taking at the end of last week to lead the miners higher, up 29c, or 5.7% to $5.35. The iron-ore producer has shown volatility this year, with shares up 20% since 1 January.
Gold miners were also strong with Lihir surging 12c, or 3.6% to $3.48. Larger rival Newcrest tacked on 86c, or 2.4% to $37.06.
Steelmakers Bluescope and Onesteel paced each other, with gains of 2.2% and 2.6%.
Alumina was also strongly favoured among investors with the company spiking 8c, or 4.1% to $2.01. Its shares are up 20% since Credit Suisse upgraded its rating on the stock on 14 December setting a price target of $2.00 per share.
The Banks and Financials sector climbed 0.5% as the big four banks put on gains of less than 0.9%.
Investment group Macquarie was unchanged at $48.90.
Insurers were mixed with QBE and Suncorp-Metway both up 0.8%, while AXA Asia Pacific and IAG retreated 0.6% each.
The Property Trusts sector was flat despite sector major Westfield easing 7c, or 0.6% to $12.64.
Energy stocks added 0.4%, with Santos, Origin, Oil Search and Woodside Petroleum all adding 0.3% to Friday’s close.
Riversdale Mining was popular again, up 32c, or 4.1% to $8.08.
Aquila Resources added 9c, or 0.8% to $11.14, though this was countered by an 87c, or 2.9% decline in the price of WorleyParsons shares.
The Industrials sector rose 0.2%, with a broad mix of gainers and losers.
Brambles was flat, while Leighton eked out a 16c, or 0.4% gain to $39.94.
Toll Holdings climbed 0.8% to $9.07.
A major mover in the sector was Auckland International Airport which slumped 3.6% to $1.59 after announcing it would pay $132 million for a stake in two North Queensland airports.
Consumer Staples edged 0.5% higher on the back of a 43c, or 1.4% gain from Wesfarmers shares.
Woolworths dipped 14c to $27.95.
Among beverage stocks Coca-Cola Amatil shed 1.5%, while Foster's rallied the same amount.
A broad decline in the retailers, meanwhile, saw the Consumer Discretionary sector ease 0.1% lower.
JB Hi-Fi lost 36c, or 1.7% to $21.32. David Jones fell 10c, or 1.9% to $5.07.
Aristocrat, Crown and Tabcorp were all trading within 0.5% of the gain line.
Among the media stocks Ten led the way, up 2.1%.
Telstra lost 1.2% to $3.34 as the Telecommunications sector shed 1.3%.
Around the region, the Nikkei 225 was closed, while the Straits Times Index gained 9.1 to 2,931.9. Meanwhile, the NZSE50 lost 11.8 to 3,298.4.
Spot gold was trading at US$1,155.10 per ounce, and the Aussie was buying US$0.9301.
Ramsay enters French health care market
Ramsay Health Care has made a foray into the French healthcare sector, taking a 57% stake in private hospital operator Groupe Proclif SAS for $142m, the group said Monday. Ramsay said it expected the purchase to deliver a small accretion to core EPS by FY12.
At noon, Ramsay Healthcare shares were up 9c to $11.16.
AIA agrees to purchase North QLD Airports
Auckland International Airport has agreed to purchase a 24.55% stake in North Queensland Airports for $132.8 million from Westpac Banking Corporation. The company said the acquisition of the Cairns and Mackay airports operator was part of its strategy to grow beyond its core business in Auckland.
At lunch, Auckland Airport shares were down 6c to $1.59, while Westpac shares were up 6c to $25.21.
CBH confirms takeover offer
CBH Resources confirmed media speculation that it had received a takeover proposal from Nyrstar NV last month. The company said the conditional, confidential and incomplete proposal valued each CBH share at 13.5c.
At midday, CBH shares were down 1c to 13.5c.
Bauxite Resources inks deal with Yankuang
Bauxite Resources announced that it has signed a Heads of Agreement with Yankuang Corporation for the joint development and ownership of an alumina refinery in the south west of Western Australia. Under the terms of the agreement, Bauxite said Yankuang would subscribe for an equity stake in BAU and be able to explore and exploit the Australian company’s tenements in the Darling Range.
At lunchtime, Bauxite Resources shares were down 2.5c to $1.01.
Santos extends gas options deadline
Santos said that GLNG, its natural gas joint venture with Malaysian giant Petronas, had extended the deadline for agreement of the sale of an extra 1 million tonnes per annum of gas from the project by Petronas. GLNG said the extension was due to discussions with a number of Asian buyers about the sales from the project.
At noon, Santos shares were up 5c to $14.34.
Mirrabooka 1H profit down 24%
Mirrabooka Investments reported a 24% reduction in net profit for the six months to 31 December 2009 compared to the previous corresponding period. The company said its profit totalled $5.6 million, while operating profit dropped 27% to $4 million.
At lunch, Mirrabooka shares were unchanged at $2.15.
Nomad downgrades guidance
Nomad Building Solutions shares slumped Monday morning after the modular building manufacturer downgraded its FY10 guidance from a profit of $10-$12m to a $2m loss. The company said it had been negatively impacted by a failure to secure the anticipated level of work, additional costs and continuing pressure on margins.
At midday, Nomad shares were down 31c to 39.5c.
