Australian shares ended flat, giving up most of the day's gains despite encouraging manufacturing data from China, as investors remained cautious amid stalled US talks to avert steep tax increases and spending cuts. Miners were only slightly shored up by the HSBC flash purchasing managers' index in China which rose to 50.9, a 14-month high and the fifth straight monthly gain, on the back of increases in new orders and jobs.
"The Australian sharemarket was mainly just going through the motions today, with the lower lead-in from Wall Street countered by some pleasing Chinese data," said Tim Waterer, senior trader at CMC Markets. Analysts and fund managers said caution would reign until US politicians reached an agreement to avert the "fiscal cliff", as the Australian market was already hovering around a 17-month high.
"Fiscal cliff uncertainties will likely continue to weigh on investment markets in the short term," said Shane Oliver, head of investment strategy at AMP Capital. "However, our assessment is that shares are likely to see their normal seasonal strength into year end," he said, adding that quantitative easing by the US Federal Reserve meant there would be more money looking for returns in the share market. The hunt for yield boosted the major banks. Commonwealth Bank led the sector with a rise of 0.6 percent.
The benchmark S&P/ASX 200 index picked up less than 1 point to end at 4,583.1 according to the latest data, not far off this week's intraday high and 17-month peak of 4,603.5. New Zealand's benchmark NZX 50 index rose 0.1 percent to 3,979.2. Improving iron ore prices bolstered Fortescue Metals Group 1.4 percent, while activity in the bigger miners was more subdued, with BHP Billiton ending up 0.2 percent and Rio Tinto up 0.4 percent.
Comments
Comments are closed.