Australia S&P/ASX 200 index surges above 5,000 points on bullish reports
AFPSYDNEY--Australia's benchmark S&P/ASX 200 index surged above 5,000 points for the first time in almost three years Wednesday on bullish corporate earnings reports and consumer confidence data.
February 14, 2013, 12:36 am TWN
The index of Australia's top 200 companies closed 44.7 points, or 0.90 percent, higher at 5,003.7 — a 34-month high.
The broader All Ordinaries ended the day up 43.0 points, or 0.86 percent, at 5,024.5 after that index hit the 5,000 mark on Tuesday.
The surge followed a strong earnings report from Australia's largest lender, Commonwealth Bank, which posted a 1-percent rise in first-half net profit to US$3.77 billion.
It was also buoyed by consumer sentiment jumping to its highest level in more than two years in February, indicating that central bank interest rate cuts were having their desired stimulatory effect.
“We had the backbone of a decent rally in place after solid earnings from CBA and ramification for margin improvement in the rest of the banks,” said IG Markets analyst Chris Weston.
“But it seems there is a real positive feedback loop taking place between stocks prices and the real economy.”
The CBA gained 2.43 percent to close at AU$67.110.