Australian market closes higher

PERTH - The Australian share market closed in positive territory for the seventh consecutive session, driven by gains in mining and energy stocks.

At the 1615 AEST close, the benchmark S&P/ASX200 index was up 17.8 points, or 0.44 per cent, at 4,068.5, while the broader All Ordinaries index gained 20.6 points, or 0.51 per cent, to 4,068.9 points.

On the Sydney Futures Exchange at 1617 AEST, the September share price index contract had inched two points higher at 4,031 points on 20,372 contracts.

CommSec market analyst Juliette Saly said investors had welcomed news that the annual inflation rate in Australia had fallen to a 10-year low.

Most energy stocks appreciated on the back of a firmer oil price, Ms Saly said.

Woodside was up 51 cents at $43.85 and Santos gained 21 cents to $14.82 but Oil Search shed eight cents to $5.50.

Mining giant BHP Billiton reported a "solid" production performance in 2008/09, despite "significant demand contraction" in a weak global economy.

Shares in BHP Billiton were up 71 cents at $36.90, while Rio Tinto gained 89 cents at $55.81.

"We have seen a bit of weakness come through from the banks today, with the National Australia Bank (NAB) tapping the market for cash," Ms Saly said.

NAB is raising $2.75 billion in new capital and earmarked the proceeds for maintaining its balance sheet, pursuing growth and improving its position in the small-to-medium sized enterprises market.

"It (the NAB raising) sent a few jitters among investors who wondered how the financial sector is holding up and whether or not other banks will have to do the same," Ms Saly said.

"Yesterday, Westpac's Gail Kelly said the financial sector was still facing another challenging 18 months, so Westpac shares are definitely under pressure today."

Westpac gave up 49 cents at $19.82, Commonwealth Bank was down 65 cents at $39.10 and ANZ added 13 cents to $16.90. NAB was in a trading halt and last traded at $23.58.

Making headlines on Wednesday, leading supermarket chain Woolworths reported "solid" growth its full year sales, up 7.5 per cent in 2008/09.

Shares in Woolworths slipped 12 cents to $27.58.

Among other retailers, Coles owner Wesfarmers advanced 48 cents to $24.56, David Jones found 19 cents to $4.86, JB Hi-Fi gained 61 cents to $16.40 and Harvey Norman eased eight cents to $3.18.

The spot price of gold in Sydney at 1618 AEST was US$948.70 per fine ounce, up 25 US cents on Tuesday's close of US$948.45.

Among gold miners, Newcrest was down 57 cents at $30.39, Newmont was up three cents at $5.15 and Lihir Gold backtracked five cents to $2.86.

Media stocks were mixed. Fairfax put on three cents at $1.375, News Corp retreated seven cents to $13.92, its non-voting scrip was 11 cents cheaper at $11.90 and Consolidated Media was six cents stronger at $2.72.

The top-traded stock by volume was diamond and gold miner North Australian Ltd with 168.48 million shares worth $2.52 million changing hands.

Its shares were unchanged at 1.5 cents.

Preliminary market turnover was 2.13 billion shares worth $4.41 billion, with 547 stocks up, 451 down and 344 unchanged.

- AAP