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Aus market posts second day of gains

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Published on: Monday, July 11, 2016

By AAP

Australian shares have risen for the second straight session, helped by strong gains in overseas markets and rally in banking stocks.

The benchmark S&P/ASX200 index closed 2.1 per cent higher following similar strong gains on Tuesday.

"Certainly, sentiment has pushed on. These are skittish markets but there seems to be belief that this has further to go," IG chief market strategist Chris Weston said.

Sentiment was bolstered by a global equities rally after Wall Street powered higher overnight.

Japan's Nikkei index soared more than five per cent, while Shanghai and Hong Kong markets also opened to a second straight day of gains.

Local home lending data showed further slowing in home lending growth in July as banks and regulators moved to cap investor activity.

Separately, the latest Westpac-Melbourne Institute consumer sentiment survey showed confidence fell by 5.6 per cent in September.

However, that did not stop investors from queuing up for banking sector stocks, with the major banks leading today's rally.

Commonwealth Bank rose $2.55 to $76.72, Westpac jumped $1.29 to $31.81, National Australia Bank gained $1.07 to $31.27, and ANZ advanced $1.01 to $28.54.

"We are seeing the elevated levels of short interest in banks being pared back. The yield play is coming back, but the valuations have also been relatively attractive," Mr Weston said.

Energy stocks continued to attract investor attention following Woodside's opportunistic bid for Oil Search.

While Woodside recovered 24 cents to $29.90, fellow energy player Santos rose 26 cents to $4.67, while Origin Energy rose 23 cents to $7.95.

In the resources sector, global miner BHP Billiton fell five cents to $24.65 after trading ex-dividend, Rio Tinto added $1.29 to $51.51, and Fortescue Metals was up eight cents at $2.04.

Retailer Woolworths was ended one cent lower at $25.32 after also turning ex-dividend.

Investors on Thursday will cast a keen eye over jobs figures for August.

KEY FACTS

  • At close on Wednesday, the benchmark S&P/ASX200 index was up 105.9 points, or 2.07 per cent, at 5,221.1 points.
  • The broader All Ordinaries index was up 103.4 points, or 2.01 per cent, at 5,236.9 points.
  • September share price index futures contract was up 115 points at 5,215 points, with 43,213 contracts traded.
  • National turnover was 1.48 billion securities worth $4.68 billion.

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