Australian Market Recovers After Weak Start

The Australian stock market climbed into positive territory on Wednesday after opening lower following the lackluster cues overnight from Wall Street and as investors digested the federal budget that includes a levy on the big banks.

In late-morning trades, the benchmark S&P/ASX 200 Index is adding 10.60 points or 0.18 percent to 5,850.50, after touching a low of 5,816.50 earlier. The broader All Ordinaries Index is rising 12.40 points or 0.21 percent to 5,886.90.

Among the major miners, Fortescue Metals is advancing more than 1 percent, BHP Billiton is adding almost 1 percent and Rio Tinto is up 0.2 percent.

South32 said that production of its metallurgical coal in Illawarra is expected to be at least 10 per cent lower than its prior full-year guidance. The miner’s shares are losing more than 4 percent.

Gold miner Newcrest Mining is adding more than 1 percent and Evolution Mining is rising almost 1 percent despite gold futures falling to their lowest in two months overnight.

In the oil sector, Oil Search is losing almost 1 percent and Santos is down 0.3 percent, while Woodside Petroleum is rising 0.5 percent after crude oil prices fell more than 1 percent overnight.

Meanwhile, the big banks are weak after the introduction of a new multi-billion tax on the five biggest banks in the federal budget unveiled by Treasurer Scott Morrison on Tuesday.

ANZ Banking, Westpac, Commonwealth Bank and National Australia Bank are down in a range of 0.8 percent to 1.2 percent. Shares of Macquarie Group are losing more than 1 percent.

Rupert Murdoch-owned News Corp. reported third-quarter financial results that beat analysts’ expectations. The media giant’s shares are advancing more than 1 percent.

Qantas budget carrier Jetstar is launching its inaugural flight to Ho Chi Minh City today. Shares of Qantas are rising 0.5 percent.

Australian Agricultural Co. reported a 5.6 percent increase in full-year profit and said it expects to further improve its performance in fiscal 2018. The beef producer’s shares are gaining more than 3 percent.

In the currency market, the Australian dollar is slightly higher against the U.S. dollar on Wednesday. In early trades, the local unit was trading at US$0.7342, up from US$0.7339 on Tuesday.

On Wall Street, stocks closed mixed on Tuesday as traders seemed reluctant to make significant moves ahead of the release of key reports on retail sales and producer and consumer prices later this week.

The Nasdaq rose 17.93 points or 0.3 percent to a new record closing high of 6,120.59, but the Dow dipped 36.50 points or 0.2 percent to 20,975.78 and the S&P 500 edged down 2.46 points or 0.1 percent to 2,396.92.

The major European markets moved to the upside on Tuesday. While the U.K.’s FTSE 100 Index advanced by 0.6 percent, the German DAX Index and the French CAC 40 Index climbed by 0.4 percent and 0.3 percent, respectively.

Crude oil futures fell Tuesday, unable to sustain a brief recovery after the government predicted higher U.S. production for the…

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