The share market has closed a touch higher as strength in the banking sector outweighed weakness among resources stocks.
Cautious investors are biding their time ahead of an important central bank meeting in the US this week.
Local banking stocks performed well after the Reserve Bank of Australia (RBA) indicated it could make another interest rate cut, CMC Markets analyst Ric Spooner said.
“The dominant feature was buying of banks, possibly reflecting the RBA’s confirmation of an easing bias,” Mr Spooner said.
Further rate cuts could help banking stocks if they stimulate demand for home loans.
National Australia Bank added 58 cents to $34.68, Westpac gained 34 cents to $32.47, ANZ rose by 44 cents to $30.79, but Commonwealth Bank dropped 45 cents to $73.60.
“Overall it’s been a relatively steady day and markets are generally waiting for the Fed meeting,” Mr Spooner said.
Some analysts expect the Federal Reserve to announce on Thursday morning, Australian time, that it will start to wind back its asset buying program, which has helped stimulate the US economy for several years.
Among the big miners, BHP Billiton was 13 cents lower at $36.14, Rio Tinto was down 64 cents at $62.76 and Fortescue Metals was up four cents at $4.62.
TPG Telecom was one of the day’s best performers, gaining 53 cents, or 14.3 per cent, to $4.23 after it substantially lifted its annual profit due to growing numbers of broadband and mobile phone customers.
Shares in coal miner New Hope dropped 29 cents to $4.00 as its annual profit fell due to lower coal prices, a high Australian dollar and one-off writedowns.
Retailer Premier Investments was seven cents lower at $8.31, after it reported a strong rise in annual profit but said retail conditions would remain challenging in Australia.
Telstra gained two cents to $4.93.
KEY FACTS
* At the close on Tuesday, the benchmark S&P/ASX200 index was up 3.2 points, or 0.06 per cent, at 5,251.2.
* The broader All Ordinaries index was up 3.5 points, or 0.07 per cent, at 5,245.2.
* The September share price index futures contract was one point lower at 5,256, with 174,035 contracts traded.
* National turnover was 1.5 billion securities worth $4.6 billion.
