Positive news lifts Australian bourse

Australian shares closed sharply higher yesterday. Photo / Thinkstock

Australian shares closed sharply higher, extending earlier gains in the day, led by bargain hunters on the back of positive company results.

At 4.15pm Sydney time, the benchmark S&P/ASX200 index was up 110.3 points, or 2.64 per cent, at 4282.9, while the broader All Ordinaries index was up 108.9 points, or 2.57 per cent, at 43426.8

On the ASX 24, the September share price index futures contract was up 123 points at 4262, with 44,532 contracts traded. Wealth Within analyst Janine Cox said the gains were the result of institutional and speculative trade following a week of panic in the markets.

"The institutionals trade with algorithms, so they'll have a lot of computer algorithms sitting there waiting to pick up the stock when they hit a certain price. A lot of that can cause a rebound, plus you get a lot of short-selling because of the spring back into the market."

Cameron Securities client adviser Adrian Leppinus said investors were quick to pounce on positive profit results at the start of the reporting season.

Condom and glove maker Ansell gained A54c or 4.1 per cent to A$13.68 after it announced a 2.7 per cent rise in full-year profit to A$122.7 million and forecast that earnings per share would rise as much as 12 per cent this financial year.

Among the miners, BHP Billiton was up A$1.64, or 4.3 per cent, at A$39.85 and Rio Tinto up A$3.00, or 4.2 per cent, at A$74.52.

Property and construction group Leighton Holdings was up A$1.64, or 8.26 per cent, at A$21.49 after saying it is confident of turning a A$1 billion full-year profit within five years after reporting yesterday a previously flagged loss of A$408.8 million.

The banks were mixed, with National Australia Bank A61c higher at A$23.57, Westpac up A70c at A$21.17, and ANZ gaining A73c to A$20.65.

Commonwealth Bank lost A$1.18, or 2.4 per cent, to A$47.38 after going ex-dividend.

- AAP