Banks, miners lead market's 1pc gain

SYDNEY - The Australian sharemarket ended the day about 1 per cent higher after getting away to a positive start on the back of high commodity prices and positive economic reports for the United States and Chinese economies.

With many of New South Wales' investors taking advantage of a long weekend, the market made the most of thin trading volumes.

Gains were broad based with all sectors pushing higher on the day, with 69 per cent of companies in positive territory.

The S&P/ASX200 index climbed 46.1 points, or 1.01 per cent, to 4625.3.

"The local market posted solid gains today helped by positive leads from the US over the weekend," Australian Stock Report head of research Geoff Saffer said.

"Banking was the strongest sector, while miners were also strong with base metal prices closing strongly on Friday.

"The rest of the market saw a general bullish mood following positive US consumer data on Friday."

Of the major miners, BHP Billiton gained 54c, or 1.37 per cent, to A$40 and Rio Tinto added 78c to A$78.08.

All four major banks closed the day higher, led by Commonwealth Bank, which added 64c to A$51.54. National Australia Bank gained 45c to A$25.45, Westpac rose 39c to A$23.32 and ANZ was 17c higher at A$23.68.

Commodity prices remain strong, with gold setting a record high on Friday and oil settling at more than US$80 a barrel.

Among the energy stocks, Woodside Petroleum gained 67c to A$44.97 and Santos rose 12c to A$12.83.

Newcrest Mining, Australia's biggest gold miner, continued to reap the benefits of record high gold prices, gaining 72c to A$40.72.

Saffer said copper prices, which act as an economic barometer, on Friday reached US$8000 a tonne for the first time in two years.

In addition, expectations had fallen of an interest rate rise when the Reserve Bank meets today, he said.

"Last week the market was pricing in a rate rise, but disastrous building approvals and weak private credit numbers have brought the chances back down.

"With a rate rise becoming less likely, interest-rate-sensitive stocks saw some gains today."

Among the consumer staples, Woolworths added 64c, or 2.21 per cent, to close at A$29.59.

In news yesterday, the TD Securities Melbourne Institute Monthly Inflation Gauge showed that in the 12 months to September, the measure rose 3.2 per cent, breaching the upper band of the central bank's 2 to 3 per cent inflation target.

Agribusiness AWB said that its takeover suitor, Canada's Agrium, had received clearance from the Australian Foreign Investment Review Board for its A$1.24 billion all-cash offer.

AWB gained half a cent to close at A$1.485.

Among the S&P/ASX 100, Rio Tinto led the gains, with Leighton Holdings a close second, adding 98c, or 2.99 per cent, to A$33.81.

Paladin Energy fell the most among the top 100, losing 18c, or 4.79 per cent, to A$3.58.

Preliminary market turnover was 1.8 billion shares changing hands for A$2.7 billion.

- AAP