Aussie stocks close 29 points higher

SYDNEY - Australian stocks have rebounded on better-than-expected employment data, robust commodity prices and strong production results from global miner Rio Tinto.

The benchmark S&P/ASX200 index closed up 29.9 points, or 0.61 per cent, at 4,898, while the broader All Ordinaries index advanced 29.3 points, or 0.6 per cent, to 4,929.4.

On the Sydney Futures Exchange at 1614 AEDT, the March share price index futures contract was 29 points higher at 4,881 on a volume of 16,987 contracts.

EL&C Baillieu director Richard Morrow says Rio's results helped boost the market.

"That will be incredibly supportive of the market," Mr Morrow said.

"Right across the board you've seen better demand.

"There's good numbers on the jobs data and upbeat comments on the economy."

Rio Tinto gained $2.03, or 2.6 per cent, to $79.15 after the miner reported a big jump in fourth quarter global iron ore production.

It also beat expectations with a new record in sales of the commodity for the period.

Rival miner BHP Billiton, which is the market's biggest stock, added 66 cents, or 1.53 per cent, to $43.78 after metals prices gained overnight.

Iron ore miner Fortescue Metals rose 17 cents, or 3.33 per cent, to $5.28.

Mr Morrow said the market had dropped over the last two days as low holiday volumes exacerbated downward moves triggered by China tightening its monetary policy and Alcan's result, which showed revenue increased but still recorded a loss.

"We're being blown around by sentiment, and we got over it today," he said.

Stocks rebound on employment, Rio, stronger commodity prices -2

The banks advanced, led by Macquarie Group, which was the best performer on Thursday among the S&P/ASX 50.

"The body language coming out of Macquarie has got back the swagger," Mr Morrow said.

Macquarie rose $1.80, or 3.7 per cent, to $50.43.

Commonwealth Bank led the big retail banks higher, advancing 78 cents, or 1.4 per cent to $56.79.

Westpac gained 28 cents, or 1.1 per cent, to $25.38, National Australia Bank rose 23 cents to $27.05 and ANZ added 10 cents to $22.40.

Macquarie Private Wealth adviser Helen Spencer said the banks were lifted by the jobs data.

"That unemployment number was a positive tick for the Australian economy and a positive for the banks," Ms Spencer said.

"That ... bodes very well for their bad debt cycle."

Labour force data released on Thursday showed that Australia's unemployment rate fell to a seasonally adjusted 5.5 per cent in December, below the median market forecast.

Stocks rebound on employment, Rio, stronger commodity prices -3

Major shares to buck the upward trend included Insurance Australia Group, falling seven cents, or 1.75 per cent, to $3.94, News Corp, losing 28 cents, or 1.61 per cent, to $17.12, and WorleyParsons, declining 29 cents, or 1.12 per cent, to $25.70.

WorleyParsons' joint venture with Transfield Services extended a deal with Woodside for the delivery of brownfield project and maintenance services at the oil and gas giant's North West Shelf operations.

Transfield stayed steady at $4.16 and Woodside fell 16 cents to $48.42.

Shares in the Kerry Stokes-controlled Iron Ore Holdings surged 14 per cent, or 26 cents, to $2.10, after the aspiring miner said it had made a new discovery at its Koodaideri South project in Western Australia.

Rio's listed subsidiary Coal & Allied reported a lift in coal production and sales for both the December quarter and calendar 2009.

The stock gained $2.50, or 2.9 per cent, to $89.

Norton Gold Fields's shares fell 16 per cent, or five cents, to 26.5 cents, after its managing director and chief financial officer quit, with one of them citing dissent with the board over the gold miner's strategic direction.

The country's biggest mobile provider Telstra has increased the data allowance on its wireless broadband plans, but still trails the download quotas of rivals. Telstra added one cent to $3.35.

Anteo Diagnostics was the most traded stock by turnover, with 677 million shares worth $39 million changing hands.

Anteo's shares more than quadrupled in value, rising 6.7 cents to 8.6 cents.

Turnover reached 3.28 billion shares, worth $3.94 billion, with 575 stocks rising, 496 falling and 385 steady.

- AAP