KEY POINTS:
MELBOURNE - Australian stocks ended higher, propelled consolidation hopes in the resources sector sparked by one of the country's biggest resources takeovers yet.
While Rio Tinto's hefty US$38.1 billion price tag for Canadian aluminium producer Alcan Inc sparked a downturn in its share price, hopes that merger and acquisition fever might spread through the sector helped boost other mining plays.
At the 1615 AEST close, the benchmark S&P/ASX200 was 26 points higher at 6389.4, while the all ordinaries gained 25.3 points to 6425.4.
But both indices touched new intraday highs, the S&P/ASX200 reaching 6436.7 and the all ordinaries touching 6469.2.
On the Sydney Futures Exchange, the September share price index contract was up 30 points at 6398 on a volume of 19,889 contracts.
CMC Markets senior dealer Josh Whiting said the market brushed off mid-week jitters to put in a strong performance.
"The news (of Rio's buy for Alcan) reignited talk of further consolidation in the global resources sector," Mr Whiting said.
"Other possible resource stock marriages suggested by analysts include a BHP Billiton takeover of US aluminum producer Alcoa, or locally an approach by Oxiana Resources for zinc miner Zinifex."
The world's biggest miner BHP Billiton added 44 cents to A$39.16, market predator Rio Tinto lost A$2.54, or 2.45 per cent, to A$101.30, and possible takeover target Alumina climbed 15 cents to A$8.55.
Mid-tier miner Oxiana firmed one cent to A$3.91 and zinc and lead miner Zinifex was steady at A$20.60.
"These speculations are exciting investors further in an environment where many are already bullish due to a rosy outlook for base metals," Mr Whiting said.
"Traders are scared of missing out on the next big takeover announcement in the materials sector."
At 1621 AEST the spot price of gold in Sydney was US$3.00 higher at US$666.60 per fine ounce.
The higher price gave fuel to miners of the precious, with Lihir adding five cents to A$3.16 and Newcrest swelled 67 cents to A$24.57.
Today's focus on resources took some of the shine from the other heavyweight sector, banking, with Commonwealth shedding nine cents to A$55.06, NAB dropping four cents to A$39.76 and ANZ retreating three cents to A$29.42, but Westpac managed to stay steady at A$26.05.
Shares in gaming giant Tabcorp lost seven cents to A$17.40 after acting chief executive Elmer Funke Kupper landed a A$4.75 million jackpot with his tenure at the top being made permanent today.
Australia's largest construction firm Leighton surrendered 24 cents to A$41.81 after revealing it is in talks with companies in the Persian Gulf region about developing partnerships.
The market was dealt a positive lead from Wall Street, with US stocks surging to a record high in their biggest one day gain in four years, thanks largely to Rio's takeover of Alcan and positive US retail sales data.
The Dow Jones industrial average jumped 283.86 points, or 2.09 per cent, to a record 13,861.73, and the Standard & Poor's 500 Index advanced 28.94 points to a record 1,547.70.
The Nasdaq Composite Index rose 49.94 points to 2,701.73.
Local retailers were given a boost by the solid data from the US, with Australia's largest grocer, Woolworths, firming 20 cents to A$28.32, peer Coles finding 15 cents to A$15.24 and smaller play David Jones lifting 15 cents to A$5.55.
"A rally in US retail stocks, together with bullish comments from retailing king-pin Gerry Harvey earlier in the week is encouraging buying in stocks like Harvey Norman, Woolworths and impending Coles Group owner Wesfarmers," Mr Whiting said.
Media interests were also higher, with News Corp leading the charge up 14 cents at A$27.43, while its non-voting stock advanced 10 cents to A$25.28, PBL improved seven cents to A$19.83 and Fairfax was ahead four cents to A$4.89.
The most traded stock of the day by volume was health service provider IM Medical, whose shares rose 0.6 cents to finish at 3.5 cents after 46.28 million shares worth A$1.5 million changed hands.
Preliminary market turnover was 1.87 billion shares with a total pricetag of A$6.55 billion, with 759 companies trading higher, 503 lower and 356 unchanged.
- AAP