Key index closes almost flat

Tag : Key Generator

THE sharemarket closed marginally higher after heavy lifting by thebig miners offset jitters among financial stocks.
The benchmark S&P/ASX 200 Index finished 6.3 points higher at5290 after clambering back from a 42-point loss early in thesession.
Macquarie Equities private client adviser Helen Spencer said theflat close hid "a tale of two markets".
"You've got the industrials, particularly the financials, beingoffset by a very robust resource sector," she said.
Among the industrials, the world's largest supplier of pallets, Brambles , defied concerns that its exposure to soaring fuel costs woulddent earnings.
Brambles confirmed it expected solid earnings growth this year andnext, with a strong pipeline of contract wins.
"The higher fuel costs haven't been biting as hard as maybe themarket was fearing," Ms Spencer said.
Brambles shares closed 67¢, or 9%, higher at $8.15.
Finance stocks slumped after Goldman Sachs advised clients to sellbank shares on widening losses and as Bank of America cut incomeestimates for brokerages, sending US financials to a five-year low.
Commonwealth Bank dropped $1.10, or 2.8%, to $38.60, its lowest in more than threemonths, and ANZ fell 65¢, or 3.5% to $17.95, its lowest in almost four years.
National Australia Bank was 14¢ worse at $26.41 and Westpac dipped 47¢ to $20.20. The nation's fifth largest bank, St George , lost 77¢, or 2.7%, to $27.35. The S&P/ASX 200 FinanceIndex was the worst performer among industry groups on Australia'sequity benchmark index.
"We're seeing global selling of financials," said Michael Birch, ofWallace Funds Management in Sydney. "There's no doubt downgrades tomortgage insurers' ratings in the last few days, coupled withpersistent requirements for capital, have led to further pressure."
Moody's last week stripped US bond insurers MBIA and AmbacFinancial Corp of their top Aaa ratings.
Weaker metal prices overnight were overshadowed by news that Rio Tinto had settled on a record iron ore price following contract talkswith Chinese steel maker Baosteel. Rio shares rose $4.17 to$141.75.
Rival BHP Billiton gained $1.28 to $45.88 before a briefing on its steel-makingmaterials business in London.
Power generator and retailer Origin climbed 90¢ to $16.42 after British giant BG Group renewedits $15.50-a-share offer. The off-market takeover bid values theAustralian company at $13.8 billion.
Qantas fell below $3 for the first time in two years as the airline faceda stand-off with unions demanding wage increases and an ongoingbattle to contain rising fuel costs. The shares closed 1¢lower at $3.02.
Rival Virgin Blue took heavier losses, giving away 2.5¢ to end 52.5¢.
Oil prices in London and New York ended higher overnight,supporting energy stocks. Woodside Petroleum put on $1.14 to $66.14, Santos finished 40¢ higher at $21.40 and Oil Search gained 15¢ to $6.43.
The gold producers were mixed after a sharp drop in the gold price. Lihir gained 2¢ at $3.10 and Newmont found 10¢ to $5.20 but Newcrest fell 84¢ tot $26.36.
At the Sydney close, spot gold was down $US21.15 an ounce at$US885.
Among the retailers, Woolworths gained 18¢ to $24.67, Wesfarmers , owner of Coles, lost 21¢ to $38.83 and upmarket trader David Jones was down 5¢ at $2.88.
AAP, with BLOOMBERG