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PERTH - The Australian stock market returned to positive territory with gains from resource giants BHP Billiton and Rio Tinto driving the bourse higher.
The benchmark S&P/ASX200 index closed up 38.3 points to 6363.4, while the all ordinaries gained 36.9 points to 6400.1.
At 1620 AEST on the Sydney Futures Exchange, the September share price index contract was 40 points higher at 6367, on a volume of 15,955 contracts.
Austock Securities senior client adviser Michael Heffernan said the market got off to a strong start following a positive lead from Wall Street overnight.
"It has been a very interesting day on the market, it opened very strongly on the back of positive news out of America and commodities, but it eased right back in the afternoon," Mr Heffernan said.
"One thing that overshadowed the market today was the employment figures ... it may have raised the possibility again of interest rates rising and that's put a dampener on the banks.
"Leading sectors today were the energy and, certainly once again, the resources sectors, they are just on a power surge at the moment, BHP are up A$4 to A$5 in the last month."
The Dow Jones industrial average picked up 76.17 points to 13,577.87, the Standard & Poor's 500 Index added 8.64 points to 1,518.76 and the Nasdaq found 12.63 points to 2,651.79.
Locally, the big miners were stronger, with BHP Billiton gaining 92 cents to A$38.72 and Rio Tinto climbing A$1.07 to A$103.84 before entering a trading halt.
Rio Tinto rose amid speculation that the mining giant may be planning a friendly bid for Canadian aluminium group Alcan Inc, challenging a hostile USA$27 billion offer from US-based Alcoa Inc.
The banking sector was weaker, with ANZ dipping 15 cents to A$29.45, the Commonwealth Bank losing 41 cents to A$55.15, the National Australia Bank falling 45 cents to A$39.80 and Westpac retreating 28 cents to A$26.05.
Engineering and construction group Clough added 2.5 cents to 49.5 cents despite it expecting to post a loss in the 2006/07 financial year after writing off A$110 million in disputed contracts.
United Group lifted 65 cents to A$18.20 after the engineering and property services firm completed an equity raising to help pay for its A$477 million acquisition of US-based Unicco Service Company.
Auspine gained two cents to A$6.59 after timber products company rejected a A$332 million takeover offer from Gunns Ltd.
Gunns was steady at A$3.22.
The retail sector was mixed, with Woolworths picking up 29 cents to A$28.12, Harvey Norman adding eight cents to A$5.47, David Jones gaining seven cents to A$5.40 and Coles shedding five cents to A$15.09.
The media sector was mixed, with News Corp adding 30 cents to A$27.29, its non-voting shares finding 32 cents to A$25.18, PBL rising 26 cents to A$19.76 but Fairfax falling two cents to A$4.85.
The energy sector was stronger, with Woodside rising 20 cents to A$46.95, Santos lifting six cents to A$13.71 and Oil Search picking up seven cents to A$4.21.
The spot price of gold was slightly lower and at 1627 AEST was trading at US$662.40 an ounce, down US$3.40 an ounce from yesterday's local close.
The gold miners were weaker, with Newcrest adding one cent to A$23.90, Newmont shedding eight cents to A$4.70 and Lihir flat at A$3.11.
Gold explorer Republic Gold was the most traded stock on the market today, with 66 million shares changing hands worth A$2.1 million.
Preliminary market turnover reached 1.9 billion worth A$6.47 billion with 722 stocks moving up, 550 stocks moving down and 327 unchanged.
- AAP