Australia’s financial sector is driving the local share market higher, with banks rallying on the Financial System Inquiry’s recommendation that they should hold more capital.
Shares in the major banks and the smaller regional players were mostly in positive territory, a day after former Commonwealth Bank boss David Murray’s final report was released by Treasurer Joe Hockey.
IG market analyst Stan Shamu said the market was having a good day, with the big banks putting uncertainty about the Murray report behind them.
“They’ll probably have to raise their capital requirements, but it won’t affect their return on equity,” Mr Shamu said.
“It will provide more stability.”
He added that the market was expecting banking capital requirements of between $20 billion to $25 billion.
The big four banks were all more than one per cent stronger.
Commonwealth Bank was 97 cents higher at $82.61, Westpac was up 53 cents at $33.54, ANZ had found 46 cents to $32.56 and National Australia Bank was up 64 cents to $33.04.
Bendigo and Adelaide Bank added three cents to $13.05, but Bank of Queensland lost nine cents to $12.42 and Suncorp fell seven cents to $14.71. Macquarie Group rose 79 cents to $61.19.
The miners were mixed, with BHP Billiton down 21 cents to $30.21, Rio Tinto added 23 cents to $57.37 and iron ore miner Fortescue Metals lost one cent to $2.67.
Coca-Cola Amatil was 11 cents lower at $9.15 after announcing it will axe 260 jobs as it undertakes a $100 million cost cutting campaign.
Qantas gained 28 cents to $2.38 after the airline said it was expecting to post an underlying net profit after tax of between $300 million and $350 million in the first six months of the 2015 financial year.
KEY FACTS
* At 1200 AEDT on Monday, the benchmark S&P/ASX200 index was 54.4 points, or 1.02 per cent, higher at 5,389.7.
* The broader All Ordinaries index was up 50.9 points, or 0.96 per cent, at 5,364.5.
* The December share price index futures contract was 62 points higher at 5,395, with 13,926 contracts traded.
* National turnover was 529 million securities worth $1.4 billion.
