The Australian stock market has shrugged off a negative lead from Wall Street as retail stocks get a boost from the federal budget.
Quay Equities head of trading Tristan K’nell said the market has made some strong gains after initially opening flat.
“Given the sharp fall in European markets we have done well to be in positive territory,” he said.
Retailers are set to benefit from Tuesday night’s budget announcement to allow small businesses to claim a tax deduction for the full value of assets worth up to $20,000 in a single year, rather than over five years as had been the case.
Harvey Norman shares gained 21 cents, or almost five per cent, to $4.595, Woolworths’ were up almost two per cent to $28.30, Dick Smith rose 5.5 per cent to $2.195 and JB HiFi was up 2.5 per cent to $20.99.
“It was definitely a day to be a retail stock that looks likely to be the main business beneficiary of last night’s federal budget,” Mr K’nell said.
Myer shares were up 8.7 per cent to $1.53 after the company announced a 2.4 per cent rise in third quarter sales.
“The Myer update failed to provide any extensive guidance, however it was positive after a disastrous recent period. Myer should also benefit from the budget,” Mr K’nell said.
Oil stocks were higher after strong gains in oil prices overnight, Woodside Petroleum was ahead 46 cents to $34.97, Santos was up 22 cents to $8.88 and Oil Search was 11.5 cents higher at $7.845.
Among the banks, ANZ added 55 cents to $32.96, National Australia Bank was 91 cents higher at $35.45 and Commonwealth Bank was 77 cents stronger at $83.65.
Westpac was down 72 cents to $33.34, after going ex-dividend.
BHP Billiton gained one cent to $32.54, after it said on Tuesday night that it will undertake a string of cost cutting measures aimed at improving efficiency and cash returns in the face of weak commodity prices.
But the other miners were lower, with Rio Tinto down 56 cents to $58.69 and Fortescue Metals losing one cent to $2.56.
KEY FACTS
* At 1208 AEST on Wednesday, the benchmark S&P/ASX200 index was 23.9 points, or 0.42 per cent, higher at 5,698.6.
* The broader All Ordinaries index was up 23.7 points, or 0.42 per cent, at 5,696.8.
* The March share price index futures contract was 25 points higher at 5,696, with 15,776 contracts traded.
* National turnover was 982 million securities worth $2.56 billion.
