The Australian share market is likely to rise as the market takes a cautiously optimistic approach that the worst of the global credit crunch may be over, dealers said Friday. For the week ending April 18 the benchmark S&P/ASX 200 index fell 9.6 points or 0.2 percent to 5,429.7.
But ANZ senior markets economist Katie Dean said strength in the US market and booming commodity prices had lifted the mood of the Australian market following its recent credit crisis-related losses.
Dean said the energy and minerals sector was leading the recovery but the finance sector had also improved following some good news out of the United States. "With investor confidence starting to return to the US market, the tone for Australian equities remains positive going into next week," she said.
Chief economist at AMP Capital Investors Shane Oliver agreed, saying the market appeared to be gathering strength. "While its been very shaky the rally in shares from the lows in mid-March still seems to be continuing and it's worth noting that share market trading volumes have remained low on days when shares fall - and high on days when shares rise, suggesting that selling pressure is continuing to fade," he said.
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