The Australian sharemarket edged slightly higher today, bouncing back from a six-month low on Friday.
The ASX200 rose 0.66% to 4073.60, while the broader All Ordinaries index rose 0.62% to 4124.4.
IG markets analyst Stan Shamu said the resources sector was the day’s best performer.
“Gold miners are mixed today despite gold extending its gains on Friday,” he said. “Financials have been quite resistant with all the big four banks gaining ground.”
“The defensive sectors lagged the rest of the market today, as healthcare, utilities and consumer staples lost ground.”
The upward trend defied major markets worldwide, with all recording falls on Friday.
Ric Spooner, chief market analyst at CMC Markets, says a couple of events over the weekend have the potential to cause “at least a short-term breather” for markets.
“Firstly, the G8 statement that emphasised the need for growth is a reminder that the ultimate outcome of the current potential political process in Europe may be a positive,” Spooner says.
“Secondly, Premier Wen Jiabo’s statement giving ‘more priority to maintaining growth’ foreshadows further monetary easing and efforts to stimulate the domestic economy in China.”
However, economic indicators today raised questions about Australia’s path to recovery.
Economy-wide spending rose in April but at the slowest pace in seven months.
The Commonwealth Bank Business Sales Indicator rose by 0.5% in trend terms in April following a 0.6% gain in March and growth of 0.8 % in January.
However, the trend growth of spending has eased for the past four months with spending falling by 1.3% in April after gains of 0.7 % in March and 2.0% in February.
Craig James, chief economist at CommSec, said that at a sectoral level, six of the 20 industry sectors contracted in trend terms in April, up from five in March and up from four in February.
“What the BSI appears to confirm is that consumers are much more focused on ‘experiences’ now, rather than just goods,” says James.
“People have their TVs, computers and phones and they are saying what next? As a result, people are spending more on travel, going to concerts and getting in in-home help.”?