The share market has closed lower despite pulling back most of its early losses after official data showed a slight improvement in China’s manufacturing activity.
A better than expected reading from China’s purchasing managers index (PMI) sparked a recovery on the market in late morning trade, CMC Markets chief market strategist Michael McCarthy said.
“The low point for the market was just after the release of that data, and from there it took off,” he said.
“We can see from the sectors that are leading the way that it’s China related action that’s lifting it.”
He said the market’s poor start to the day was surprising given an encouraging lead from Wall Street and stronger commodity prices.
The fall may have been related to the beginning of a new quarter of the financial year, Mr McCarthy said.
Speculation that BHP Billiton was considering demerging assets had also supported BHP’s share price and the resources sector, he said.
BHP gained 58 cents to $37.05, Rio Tinto added 30 cents to $63.85 and Fortescue Metals was six cents higher at $5.31.
The big banks were mixed, with Commonwealth Bank down 31 cents to $77.13 and National Australia Bank down four cents to $35.42, while Westpac added three cents to $34.59 and ANZ nudged up one cent to $33.07.
Telstra dropped three cents to $5.05.
KEY FACTS
* At the close on Tuesday the benchmark S&P/ASX200 index was down 5.6 points, or 0.1 per cent, at 5,389.2 points.
* The broader All Ordinaries index was down 8.1 points, or 0.15 per cent, to 5,394.9 points.
* The June share price index futures contract was 10 points lower at 5,383 points, with 29,439 contracts traded.
* National turnover was 1.85 billion securities worth $4.4 billion.