News from AAP

Aussie market up more than 1%

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The Australian share market has made solid gains, buoyed by a strong production report from global miner BHP Billiton and expectations that the European Central Bank will take steps to boost the eurozone’s sputtering economy.

BHP Billiton on Wednesday released another record-breaking production report and has responded to the diving oil price by slashing spending on drilling and exploration.

BHP Billiton increased overall group production by nine per cent in the first half with records in five of its commodities: iron ore, petroleum, coal, manganese and alumina.

Meanwhile investors are looking ahead to a meeting of the European Central Bank on Thursday, with the markets now firmly expecting it will begin a sovereign bond-buying program.

CMC Markets chief market analyst Ric Spooner said the first factor lifting the Australian share market was BHP Billiton’s “good, solid” production report.

“That set a relatively positive tone for the materials sector,” Mr Spooner said.

“The other thing behind what’s going on today is the market starting to position again for what appears to be increasingly firm expectations of a quantitative easing initiative by the European Central Bank.”

BHP Billiton rose 57 cents, or 2.07 per cent, to $28.05, Rio Tinto added $1.40, or 2.61 per cent, to $55.09, but Fortescue Metals scraped off one cent to $2.32.

Gold miner Newcrest ascended 54 cents, or 4.09 per cent, to $13.74.

Oil and gas producer Woodside Petroleum gained 35 cents at $32.60, Santos dipped six cents to $7.33, and Oil Search fell seven cents to $7.41.

Among the major banks, ANZ improved 12 cents to $31.63, Commonwealth Bank climbed $1.17 to $84.67, Westpac found 49 cents at $33.38, and National Australia Bank put on 52 cents at $34.08.

KEY FACTS

* On Wednesday, the benchmark S&P/ASX200 index was up 85.7 points, or 1.61 per cent, at 5,393.4 points.

* The broader All Ordinaries index was up 80.6 points, or 1.52 per cent, at 5,367.4 points.

* The March share price index futures contract was 85 points higher at 5,343 points, with 28,428 contracts traded.

* The price of gold in Sydney at 1700 AEDT was $US1,300.20 per fine ounce, up $US23.40 from $US1,276.80 on Tuesday.

* National turnover was 1.24 billion securities worth $4.2 billion.