Australian market closes slightly higher; Macquarie Group plunges nearly 10%

The Australian stock market closed slightly higher on Wednesday after posting marginal losses on Tuesday. Wall Street provided a mixed lead, as an increase in oil prices offset positive sentiment from better than expected numbers on U.S. consumer confidence.

Energy stocks gained on higher oil prices, but financial stocks were weak on credit crunch concerns. The benchmark S&P/ASX 200 index closed up 3.7 points or 0.07% at 5,011.2 after losing 0.2% on Tuesday. The broader All Ordinaries index lost 5.5 points or 0.11% to finish 5,087.8. In the currency market, the Australian dollar closed higher after dropping to an eleven-month low during offshore trading. The Aussie finished the local session at US$0.8580-0.8582, up from Tuesday's close of US$0.8559-0.8563. In the U.S., the Dow Industrials rose 0.23% and the broader S&P 500 advanced 0.37%, while the tech-heavy Nasdaq fell 0.15% on Tuesday. Oil prices rose Tuesday on concerns that Hurricane Gustav could cause problems for the Gulf of Mexico's oil region. Light sweet crude for October delivery closed at $116.27 a barrel, up $1.16. Oil continued to rise in the Asian session Wednesday and was gaining 33 cents to $116.60 a barrel by 2:23 a.m. ET. On the economic front, the Australian Bureau of Statistics said that the value of total construction work done in Australia fell 2.6% in volume terms in the second quarter of 2008. The total construction work done for the quarter was valued at A$30.137 billion, compared to an upwardly revised A$30.947 billion in the March quarter. On a seasonally adjusted basis, total value of building work done in the June quarter rose to A$16.797 billion from an upwardly revised A$16.756 billion in the March quarter. Among banking stocks, Commonwealth Bank lost 1.7%, ANZ Banking Group slipped 0.3% and Westpac and National Australia Bank declined 0.2% each. St. George bank dropped 1.0%, while investment bank Macquarie Group slumped 9.6% after broker UBS downgraded its recommendation on the stock to "Neutral" from "Buy". In the resources sector, index leader BHP Billiton added 0.3% and Rio Tinto rose 0.8% after the miner reported a 55% increase in first-half underlying net profit on Tuesday, beating analysts' forecasts. Gold miner Lihir Gold surged 3.1%, while Newcrest Mining closed unchanged. Energy stocks were higher, with Woodside Petroleum and Oil Search jumping 3.4% each and Santos gaining 3.1%. Woodside posted an 86% jump in first-half underlying earnings, on the back of record crude prices during the period, and reiterated its production outlook. In the retail sector, David Jones advanced 1.4%, Coles owner Wesfarmers gained 2.1%, and Woolworths jumped 2.7%. Westfield Group, the world's largest shopping mall owner, fell 3.4% on concerns about a weak U.S. economic outlook though the group reported a 10% rise in first-half operating earnings, which was in line with expectations. Centro Properties tumbled 8.6% on ongoing concerns about its ability to refinance its debt and Toll road investor Transurban Group fell 2.4% as the company reiterated that it would halve its distribution in fiscal 2009 to shore up its balance sheet after reporting a 19% rise in full-year underlying earnings. Copyright(c) 2008 RealTimeTraders.com, Inc. All Rights Reserved