Following a lead from Wall St, Australian shares rallied more than three per cent today.
The S&P/ASX 200 advanced 129.6 points or 3.47 per cent to 3867.1.
Shane Oliver, head of investment strategy at AMP Capital Investors told Reuters that volumes are thin and gains are not as strong as they look.
"It's too early to say the correction is over," he said. "Volumes are so thin it's dangerous to read too much into the bounce."
Wall St rallied overnight after positive comments by banking analyst Meredith Whitney. She predicts the quarterly results of banks will be better than expected and they will make at least a short-term gain of 15 per cent. Ahead of Goldman Sachs’ earnings report this week, Whitney also upgraded shares of the company to “buy”. Other companies set to report include JPMorgan Chase and Bank of America.
According to a monthly NAB Business survey, business confidence was up for June. The index rose by six to plus-four. This was the best outcome since December 2007. Business conditions were also higher, up from minus-14 to minus-two. This was the best result since September 2008.
On Australian markets, by industry sector, energy was up 433.7 points to 3.23 per cent, financials gained 127.5 points or 3.6 per cent, industrials put on 74.1 points or 2.64 per cent, and utilities up 96.6 points or 2.46 per cent. Health care dropped 21.1 points or 0.27 per cent.
Shares in BHP Billiton were up $1.59 or 4.94 per cent to $33.79, while Rio Tinto gained $2.47 or 5.30 per cent to $49.10.
In energy stocks, Woodside Petroleum put on $1.14 or 2.91 per cent to $40.34, while Santos was up $0.37 or 2.84 per cent to $13.39.
The Big Four banks all made gains. NAB put on $1.06 or 4.83 per cent to $23.00, ANZ was up $0.63 or four per cent to $16.83, the Commonwealth Bank gained $1.58 or 4.3 per cent to $38.30, and Westpac rose $0.74 or 3.91 per cent to $19.65. Macquarie Group was up $1.63 or 4.61 per cent to $37.00.
Among the retailers, Wesfarmers gained $0.74 or 3.35 per cent to $22.84 and Woolworths were up $0.43 or 1.64 per cent to $26.70.
Asian markets were also up, with the Nikkei 211.5 points or 2.34 per cent higher to 9261.8, and the Hang Seng up 406.4 points or 2.36 per cent to 17661.0.
Oil was at US$60.36 a barrel, and the Oz dollar was trading at 78.82 US cents.
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