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Shares open higher on telecoms

Posted by on March 22, 2011 0 Comment

Shares have opened higher, with telecoms and utilities among the big market movers on the back of a positive night on Wall Street.

At 10.37am (AEDT), the benchmark S&P/ASX200 index was up 27.9 points, or 0.6 per cent, at 4670.7 points, while the broader All Ordinaries index had risen 29.7 points, or 0.63 per cent, to 4763.8 points.

On the ASX24, the June share price index futures contract was 26 points higher at 4690 points, with 10,916 contracts traded.

The telecoms sector was up 1.22 per cent, while utilities-linked companies were 1.67 per cent higher in morning trade, according to Iress data.

There were about 17 shares up for every five that were down.

RBS Morgans Ipswich manager Tony Russell said the strong performance of telcos in morning trade reflected the positive response in offshore markets of AT&T’s proposed $US39 billion acquisition of T-Mobile USA.

“Certainly the change in sentiment to our technology stocks this morning has been fuelled by the corporate activity in the United States,” Mr Russell said.

The deal, which requires regulator approval, would create the biggest US wireless provider.

Telstra was 2c higher at $2.66, while SingTel, which owns Optus, was 1c firmer at $2.29.

TPG Telecom, which upgraded earnings guidance and said margins were improving after it reported a double-digit lift in first half net profit and revenue, gained 12.5c, or 9.19 per cent, to $1.485.

Mr Russell said the broader market was firmer as investors gained a clearer picture of the unfolding situation in Libya and Japan.

“I think the market is coming more to terms with that, even though there is probably a long way to go in both those scenarios,” Mr Russell said.

“We’ve seen some confidence come back into our markets.”

On Wall Street overnight, the Dow Jones Industrial Average advanced 1.5 per cent, the S&P500 climbed 1.5 per cent and the NASDAQ ended 1.83 per cent firmer.

Gold and silver futures contract prices rose, while oil prices closed above $US102 a barrel.

The big retail banks were higher.

ANZ was up 26c at $23.30, CBA had risen 55c to $51.20, NAB was 27c firmer at $24.99 and Westpac had climbed 22c to $23.00.

NAB said it had resolved a dispute with the tax office over an Exchangeable Capital Units (ExCaps) capital raising without any admission of liability.

Among the big miners, BHP was up five cents at $44.55, while Rio Tinto was 53c higher at $81.53.

Reports from the UK overnight suggested Rio was planning a push into Russian diamond mining in a bid to cash-in on increased demand from China.

The spot price of gold in Sydney was at $US1426.50 per ounce, down US52c from yesterday’s local close of $US1427.02.

Newcrest was up 46c at $37.40, while Kingsgate Consolidated was 16c firmer at $8.74.

Pawn broker Cash Converters said it would sell majority ownership in the company as part of a strategic relationship to be formed with US based EZCORP Inc.

Cash Converters was in a trading halt and last traded at 83c.

National turnover was 730.56 million securities worth $1.08 billion, with 616 shares up, 226 down and 311 unchanged.

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