The Australian share market is trading higher, with investors buoyed by encouraging signs that politicians in the United States may soon reach a deal over the US budget and debt ceiling.
“The announcement that they are talking again, that they are holding meetings and so forth has been taken as a constructive sign,” CMC Markets chief analyst Ric Spooner said.
Investors appeared to have become slightly less concerned in recent days about the possibility of a US debt default, he said.
“They wouldn’t be happy about it, but generally, it would be seen as a technical default in the sense that the government was able but unwilling to pay, and the net result would be a temporary delay in payment to bondholders,” Mr Spooner said.
Signs that the US could avert a debt default emerged in the US on Monday, with talks between Democrats and Republicans resuming, three days before the deadline to raise the US government’s borrowing limit.
On the local market, most sectors had posted gains.
In resources, BHP Billiton was up 39 cents at $35.45, Rio Tinto had picked up $1.04 to $62.69 and Fortescue Metals was 17 cents higher at $5.14.
Among the major banks, Westpac was up 34 cents to $33.29, ANZ was up 32 cents at $31.46, Commonwealth Bank had firmed 72 cents to $73.24, and National Australia Bank was 26 cents higher at $35.02.
Elsewhere, Telstra was 5.5 cents higher at $4.985 as it maintained its forecasts of low single-digit income and earnings growth in the current financial year.
Wagering firm Tabcorp was steady at $3.25 after its revenue in the September quarter rose more than three per cent on the prior corresponding period, despite tough trading conditions.
Fuel supplier and retailer Caltex had gained 21 cents to $18.50 after it said it would sell its Sydney bitumen business to a subsidiary of a Dutch commodities trader.
KEY FACTS
* At 1210 AEDT, the benchmark S&P/ASX200 index was up 50.4 points, or 0.97 per cent, at 5,258.3 points.
* The broader All Ordinaries index was up 50.6 points, or 0.97 per cent, at 5,257.1 points.
* The December share price index futures contract was up 43 points at 5,250 points, with 9,618 contracts traded.
* National turnover was 648.4 million securities worth $1.22 billion.
