Australian stocks surge

Australian stocks rose to their highest level in two years on Monday as strong demand for banks and resources underpinned the overall market.
But a holiday in Melbourne, Australia's second largest financial centre, made for a slightly quieter session. Turnover at A$1.9 billion ($1.4 billion) was below the A$2.2 billion daily average.
The benchmark S&P/ASX 200 index closed 12.5 points, or 0.4 percent, higher at 3420.0, after earlier touching 3,427.5 - a level last seen in March, 2002.
Analysts said the main driving factor was Friday's disappointing US employment data, which prompted Wall Street economists to push out expectations for the first rate increase.
"If you've not going to get rate hikes, that's positive for interest-sensitive stocks. You're seeing it in the utilities as well, a traditional yield sector," said Tony Oesterheld, head of equities at AMP Capital Value-Plus team.
US non-farm payrolls rose a paltry 21,000 in February against a forecast increase of 125,000.
Hans Kunnen, head of investment markets at Colonial First State Fund Managers, said the interest rate situation was helping fuel demand for stocks, which were already fired up by a positive outlook for profit growth.
"Having seen the profit-reporting season and the outlook for the next 12 months, equities aren't overdone," he said.
Among banks, Westpac touched an all-time high of A$17.50, before easing back to A$17.42, up 2.0 percent, while ANZ put on 2.2 percent to 21-month highs of A$18.75.
Blue-chip miners pared early gains to finish just slightly higher. BHP Billiton added 0.2 percent to A$12.56, and rival Rio Tinto gained 0.6 percent to A$36.36.
Elsewhere, Great Southern Plantations rallied 8.5 percent to a 3-1/2 year high of A$2.80 after achieving a record 166 percent increase in sales for its 2003 project. The company packages, promotes and manages investment in timber plantations.
In contrast, shares in dominant telco Telstra shed 1.1 percent to A$4.72 after the company announced that its wholly owned Sensis unit had bought weekly classified advertisement publication, the Trading Post, for A$636 million.
Media giant News Corp was also softer, easing 1.4 percent to A$12.28 while its preferred shares shed 1.1 percent to A$10.75.