Banks lead stocks higher

Australian shares are marginally firmer as a fall in US home sales gives financial stocks a boost.
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Around midday, the benchmark S&P/ASX200 index was 15.5 points higher, or 0.3 per cent, at 5,138.9 points, while the broader All Ordinaries index was up 16 points, or 0.31 per cent, at 5,131.1.

A 13.4 per cent drop in American new home sales for July convinced investors the US Federal Reserve would continue with its stimulus measures, for now.

‘‘Expectations that the Federal Reserve might start to taper – but later in the year – means there’s more joy for Aussie finance stocks,’’ CommSec market analyst Juliana Roadley said.

‘‘Sentiment has helped the banks rise … The banks are holding up OK, just small gains there.’’

Among the major banks, National Australia Bank added 17 cents at $32.63, Commonwealth Bank rose 38 cents to $72.43, Westpac picked up 12.5 cents to $31.595, and ANZ advanced 22 cents to $29.86.

A jump in the spot price of gold to an 11-week high, just shy of $US1400 per fine ounce, has also helped gold miner Newcrest add 92 cents, or 7.04 per cent, to $13.98.

‘‘A lot of the tensions in Syria are pushing that gold price higher,’’ Ms Roadley said.

Meanwhile, drilling company Boart Longyear fell four cents, or 7.21 per cent, to 51.5 cents, after it said it had made a half-year net loss of $329 million as it deals with a mining investment downturn.

Oil giant Caltex lost 34 cents to $18.61 after it reported a 13 per cent drop in first half profit, due to a weakening Australian dollar and a pipeline outage.

But health insurer nib firmed three cents to $2.16 after it reported a slight dip in net profit because of costs associated with the acquisition of a New Zealand insurance company.

In the resources sector, global miner BHP Billiton dropped nine cents to $35.55, while Rio Tinto found 10 cents at $60.03.

BusinessDay, with wires

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