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Late recovery takes share market higher

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Published on: Wednesday, March 15, 2017

The share market has staged a late recovery to close in positive territory for a second consecutive session, with the heavyweight mining sector the key area of strength.

The benchmark S&P/ASX200 index rose 0.26 per cent after spending most of the session in negative territory.

Shaw and Partners senior private client adviser Craig Sidney said the late market recovery was primarily due to demand for mining stocks ahead of the US Federal Reserve's rate decision on Thursday.

"The key tonight for the Australian market to watch is the results of the Fed meeting, whereby we expect them to lift interest rates by a quarter of a per cent," he said.

Rio Tinto, BHP Billiton and Fortescue Metals found support on the back of the rising iron ore price in Asia, Mr Sidney said.

"We have seen positive data recently out of China so if the US does lift interest rates that's typically going to be positive for the resource stocks."

Rio Tinto gained 2.2 per cent, BHP rose 1.5 per cent and Fortescue jumped 5.65 per cent.

The big four banks were mixed due to a "a little bit of uncertainty" leading into the Fed meeting and some profit taking, Mr Sidney said.

Westpac and National Australia Bank had modest falls and Commonwealth Bank and ANZ posted slight gains.

The energy sector was mixed, with Caltex, Oil Search and Origin Energy gaining in value, while Woodside Petroleum and Santos lost ground, after oil prices hit a three-month low overnight.

Energy bosses met with Prime Minister Malcolm Turnbull on Wednesday to address a looming energy crisis, and have guaranteed to ensure gas is available for the Australian market.

The Australian dollar edged higher, and will be heavily influenced by the US Fed's rate decision and comments on future rate movements.

ON THE ASX:

* The benchmark S&P/ASX200 was up 14.9 points, or 0.26 per cent at 5,774 points.

* The broader All Ordinaries index was up 15.6 points, or 0.27 per cent, at 5,813.7 points.

* The March SPI200 futures contract was up 20 points, or 0.35 per cent, at 5,782 points.

* National turnover was 3.2 billion securities traded worth $6.9 billion.

CURRENCY SNAPSHOT AT 1700 AEDT:

One Australian dollar buys:

* 75.71 US cents, from 75.63 US cents on Tuesday

* 86.92 Japanese yen, from 86.86 yen

* 71.30 euro cents, from 70.96 euro cents

* 62.18 British pence, from 61.98 pence

* 109.18 New Zealand cents, from 109.23 NZ cents

GOLD:

The spot price of gold in Sydney at 1700 AEDT was $US1,202.83 per fine ounce, down 37 US cents from $US1,203.20 on Tuesday.

BOND SNAPSHOT AT 1630 AEDT:

* CGS 5.25 per cent March 2019, 1.877pct, down from 1.879pct

* CGS 4.25pct April 2026, 2.859pct, down from 2.869pct

Sydney Futures Exchange prices:

* March 2017 10-year bond futures contract at 97.042 (implying a yield of 2.958pct), from 97.043 (2.957pct) on Tuesday

* March 2017 3-year bond futures contract at 97.860 (2.14pct), up from 97.850 (2.15pct)

(*Currency closes taken at 1700 AEDT previous local session, bond market closes taken at 1630 AEDT previous local session)


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