The Australian share market has closed marginally higher as a slightly positive performance from most of the major banks outweighed weakness in the resources sector.
IG market strategist Stan Shamu said the market swung wildly during trading on Thursday as investors decided whether they wanted to sell bank stocks or buy them.
“Our market doesn’t know what it’s doing,” Mr Shamu said.
“It’s largely to do with the movement in the banks. It’s really what’s dictating the irregular moves.”
Mr Shamu said there was some confusion among investors over the US Federal Reserve’s new hawkish stance on interest rates, and what the end of current economic stimulus measures will mean for the banks and other high-yielding stocks.
The US Federal Reserve has lifted its estimate for the level of the central bank’s benchmark interest rate by the end of 2015.
Mr Shamu said that in recent days, the banks had been sold off in anticipation of the hawkish shift by the Federal Reserve.
“Now that it’s actually been announced and it looks like that is the case, some people feel that this is now a bottom for the whole situation,” he said.
“Some investors are now looking to buy the banks after the recent sell-off.”
Among the big banks, Commonwealth Bank added 23 cents to $77.58, Westpac lifted 15 cents to $33.05, National Australia Bank was up three cents at $33.21, but ANZ scraped off one cent to $31.42, according to preliminary closing figures.
In the resources sector, global miner BHP Billiton shed 16 cents to cents to $35.68, Rio Tinto eased seven cents to $61.98, and Fortescue Metals dropped 8.5 cents to $3.935.
Iron ore miner and steelmaker Arrium plunged 16.5 cents, or 29.2 per cent, to 40 cents after it completed the first stage of its $754 million capital raising.
Oroton, the company behind the the luxury accessory label of the same name, jumped 45 cents, or 12.3 per cent, to $4.10 after lifting its underlying full year profit 16 per cent.
KEY FACTS
* At 1631 AEST, according to preliminary closing figures, the benchmark S&P/ASX200 index was up 8.5 points, or 0.16 per cent, at 5,415.8 points.
* The broader All Ordinaries index rose 7.6 points, or 0.14 per cent, to 5,419.0 points.
* The September share price index futures contract expired 19 points higher at 5,421 points, with 10,824 contracts traded.
* The December share price index futures contract was up one point at 5,402 points, with 43,693 contracts traded.
* National turnover was 2.3 billion securities worth $6 billion.
