Aussie stocks: Market closes firmer

MELBOURNE - The Australian share market has closed firmly higher, driven by resource and banking stocks and positive lead from Wall Street.

By 1615 AEST, the benchmark S&P/ASX200 index was up 57.4 points, or 1.48 per cent, at 3924.5 points, while the broader All Ordinaries index had gained 58.7 points, or 1.52 per cent, to 3917.5 points.

On the Sydney Futures Exchange, the September share price index contract was up 53 points at 3,900 on volume of 24,497 contracts.

Macquarie Equities adviser Helen Spencer said US futures were trading higher ahead of the US markets' opening on Wednesday evening AEST.

"This is helping our market to hold its gains from this morning," she said.

"The market is waiting to see how US corporates are faring as we get into the US reporting season.

"That's why volumes have continued to be quite light."

"Following on from a positive (offshore) lead, commodity prices were trading significantly higher overnight."

Rio Tinto finished 98 cents, or two per cent, stronger at $50.08 after its maintained its full year production guidance for iron ore.

Global iron ore production jumped by eight per cent in the June quarter from the same period last year, as market conditions remained tough, Rio said.

Rival BHP Billiton gained 51 cents, or 1.51 per cent, to $34.30, while Alumina jumped nine cents, or 6.72 per cent, to $1.43.

Bank stocks had a second consecutive day of gains, with better than expected earnings from US investment banking giant Goldman Sachs helping to drive sentiment in the local sector.

Westpac Banking Corp added 31 cents to $19.96, while National Australia Bank put on 35 cents to $23.35, Commonwealth Bank gained 52 cents to $38.82 and ANZ Bank firmed 12 cents to $16.50.

By 1624 AEST the oil sector made solid gains, with Oil Search advancing seven cents to $5.28 and Santos up 18 cents at $13.57.

Woodside Petroleum gained 55 cents to $40.89.

Among gold miners dual listed Newmont Mining Corporation lost eight cents to $4.88, Lihir Gold firmed two cents to $2.89 and Newcrest Mining added 22 cents to $30.26.

By 1629 AEST the spot price of gold in Sydney was US$926.90, up US$6.30 on Tuesday's close of US$920.60.

Cape Lambert Iron Ore Ltd jumped one cent to 33 cents after announcing plans to take a substantial slice of junior uranium explorer Cauldron Energy Ltd.

Shares in Dioro Exploration NL leaped six cents to 73 cents after the company said it was in talks with third parties regarding potential takeover bids that could rival Avoca Resources Ltd's revised hostile offer, which Dioro has rejected.

In the retail sector the major movers included Pacific Brands, down five cents at 94 cents and upmarket store owner David Jones, which advanced 14 cents to $4.57.

By 1638 AEST the major media stocks were higher, with the Seven Network gaining 19 cents, or 3.44 per cent, to $5.72.

Fairfax Media firmed three cents to $1.185, while News Corp advanced 16 cents to $12.84 and its non-voting scrip gained 18 cents to $10.95.

Airline Virgin Blue Holdings fell 1.5 cents to 29.5 cents and national carrier Qantas firmed three cents to $1.97.

Baraka Petroleum was the top traded stock by volume, with 93.67 million shares changing hands for $622,636. The stock closed down 2.4 cents, or 80 per cent, at 0.6 per cent.

The Perth energy company's shares resumed trading today after the company completed a $2 million capital raising last Friday.

Preliminary national turnover reached 1.78 billion shares worth $3.93 billion, with 659 shares up, 319 down and 305 steady.

- AAP