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Aust stocks close higher, but fail to follow big US lead

17 Dec 2008 4:34 PM
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S&P/ASX200 +14.4 3570.6 Dow Jones +359.61 8924.14

All Ords +16.1 3515.0 S&P 500 +44.61 913.18

SPI contract -2.0 3553.0 Nasdaq +81.55 1589.89

Gold $USoz +15.4 852.00 Nikkei -110.56 8457.46

$A/USD +.0285 0.6983 NZSE-50 +0.846 2695.930

MELBOURNE, Dec 17 AAP - The Australian stock market closed slightly higher on Wednesday but investors ignored a big lead from United States markets, instead taking an axe to some major banks.

At the 1615 AEDT close, the benchmark S&P/ASX200 index had gained 14.4 points, or 0.4 per cent, to 3570.6 points, while the broader All Ordinaries index was up 16.1 points, or 0.46 per cent, at 3515.0 points.

On the Sydney Futures Exchange, the December share price index futures contract was off two points at 3553 points on a volume of 133,601 contracts, according to preliminary calculations.

CMC Markets senior dealer James Foulsham said there had been some really strong gains on United States markets overnight, including in the financial sector, after another interest rate cut there.

It had been expected that the gains would flow on to the Australian market.

However, an announcement by the Commonwealth Bank late on Tuesday that it was raising $2 billion in equity from a placement in two parts had not pleased investors.

"The market has been dominated by what's happened with the Commonwealth Bank," Mr Foulsham said.

"Anything to do with raising money, the market doesn't seem to like at all," Mr Foulsham said.

Mr Foulsham said there was appeared to be some uncertainty in the information released by the bank in relation to the equity raising, which had also unsettled investors.

In the banking sector, the Commonwealth Bank, was steady at $29.15 before it went into a trading halt.

Westpac fell 77 cents, or 4.67 per cent, to $15.72 as it said the integration of St George Bank, which it took over last month, was going well.

The ANZ reversed 66 cents, or 4.6 per cent, to $13.70.

The National Australia Bank was up 12 cents at $19.32 as it said it was in advanced talks to acquire mortgage lender Wizard Home Loans' brand name and Australian distribution network for an undisclosed price from GE Money.

On Wall Street on Wednesday, the Dow Jones Industrial Average index soared 359.61 points, or 4.20 per cent, to 8,924.14 as investors cheered a Federal Reserve decision to cut its key rate to near zero and its pledge of more steps to revive economic activity.

Stock Move Price

AMP -0.010 5.290

ANZ Bank -0.660 13.700

BHPBilton +0.310 30.950

CBA - 29.150

NAB +0.120 19.320

NewsCorp +0.400 12.700

Polartech - .165

Rio Tinto +1.120 40.320

TelstraCp +0.020 3.560

WestpacBk -0.770 15.720

Woolwrths +0.520 25.750