Australia Stocks Rally After U.S. Gains; Myer Drops On Earnings

MarketWatch Pulse

Australian stocks came barreling upward in early Thursday trading, with the S&P/ASX 200 climbing 1.3% after a strong showing on the U.S. markets overnight. Wall Street saw solid gains after the Federal Reserve dropped the word "patient" from its policy statement but also indicated policy makers were forecasting a slower road to tightening rates. As with their U.S. peers, Sydney-listed bank stocks rose, with Westpac Banking Corp. up 1.4%, Commonwealth Bank of Australia up 1.1%, and National Australia Bank Ltd. and Australia & New Zealand Banking Group up 1% each. Among other financials, Suncorp Group Ltd. gained 1.4%, AMP Ltd. added 1.9%, and Bank of Queensland Ltd. improved by 1.5%. The Fed statement also pulled the U.S. dollar lower, giving a lift to crude-oil futures and, by extension, energy shares. Santos Ltd. rose 2%, Beach Energy Ltd. rallied 2.6%, and Caltex Australia Ltd. traded 2.3% higher. This helped to offset a lurch lower for iron-ore miners after concerns about Chinese demand helped send iron-ore prices to their lowest point since the 2008 financial crisis. Atlas Iron Ltd. dropped 5.3%, BC Iron Ltd. lost 2%, and Mt. Gibson Iron Ltd. gave up 1.3%. On the other hand, Fortescue Metals Group Ltd. rose 0.8% after heavy losses in the previous session, and senior miners BHP Billiton Ltd. and Rio Tinto Ltd. gained 1.3% and 0.6%, respectively. On the earnings front, Myer Holdings Ltd. tumbled 5.9% after reporting a 23% drop in fiscal-first-half profit and warning on the outlook for the second half as well. And Sigma Pharmaceuticals Ltd. rose 3.1% after announcing a special dividend and higher sales, even as 2014 net profit eased 1.4% lower.

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