ASX nudges higher

THE Australian market continued its week of flat trading but gains by the miners on the back of positive Chinese manufacturing data helped push shares marginally higher.

Lauren Barrett

Punters were flooded with both local and offshore news today.

Australian Industry Group’s performance of manufacturing index for July showed manufacturing production fell 7.6 points in June to 42 points.

Miners took comfort in official government data from China showing its manufacturing sector strengthened in July with a reading of 50.3 points.

However, the figure contradicted HSBC’s PMI reading for the country, which hinted at a decline in operating conditions as manufacturing output fell from 48.2 points in June to 47.7 in July.

The S&P/ASX 200 index posted a sharp fall in the mid-afternoon as banking stocks were impacted by reports the government might impose a guarantee level.

After a sway between the black and red, a 0.8% fall in the financial sector was offset by gains in the wider market, with the index firming 0.2% to 5061.5 points.

The All Ordinaries also gained 0.2% to 5047.1 points, while the Australian dollar was last trading at US89.68c.

Basic materials posted a 1.2% gain as miners were encouraged by the China data.

Given iron ore companies’ reliance on China’s growth, Fortescue Metals Group gained just 0.3% to $A3.67 but Atlas Iron picked up 2.4% to 83.5c.

Meanwhile, Gindalbie Metals fell 6.1% to 15.5c after confirming a delay to reaching nameplate capacity at its Karara project.

Among the big boys, Rio Tinto was up 0.7% to $57.94, while BHP Billiton lifted 1.5% to $35.17.

Alacer Gold Corporation slumped 8.9% to $2.56 a day after announcing a non-cash impairment loss in the millions of dollars.

Other gold miners trading lower were Silver Lake Resources, down 6.8% to 75.5c, while OceanaGold Corporation lost 2% to $1.74.

Aquarius Platinum dipped 8.1% to 74c.

Acquisition-hungry Cauldron Energy advanced for a second straight day, gaining 20% to 18c.

Finally, Paladin Energy went into a trading halt pending news relating to its strategic initiatives.

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