Banks, miners lead shares rally

THE sharemarket overcame a poor start to close higher, helped by a late rally in banks and support for the miners on the back of improvements in commodity prices.

Economic data was also supportive but investor sentiment was tempered by the potential for a strengthening economy to boost the case for a lift in interest rates.

The benchmark ASX200 stock index added 4.2 points, or 0.07 per cent, to 5706.2 points and the broader All Ordinaries Index also gained 0.07 per cent to 5767.8.

CMC Markets chief market strategist Michael McCarthy described yesterday’s trading as “a draw”.

“We’ve seen fairly modest reactions around the world to North Korea’s intransigence and the White House’s bellicosity,” Mr McCarthy said. “And given we’ve seen a strong rally in industrial commodities over the last week or so.”

The Commonwealth Bank gained 18c to $74.59, National Australia Bank 9c to $30.35 and Westpac 6c to $31.29, but ANZ dropped 5c to $29.35.

BHP Billiton added 0.5 per cent to $27.62, Rio Tinto 0.65 per cent to $68.12 and Fortescue Metals was 0.85 per cent stronger at $5.93.

Gold miners were stronger after gold prices surged to their highest levels in nearly a year. Newcrest Mining rose 0.7 per cent to $23.48.

The Australian dollar hit US79.83c soon after release of the data, before later easing.