ASX Jumps 1% as RBA Cuts Rates
SYDNEY -- The S&P/ASX 200 Index (INDEX: ^AXJO) has posted a 1% jump today, closing at 4,433 on the back of positive overnight U.S. manufacturing news and the Reserve Bank of Australia's (RBA) 0.25% cut to official interest rates this afternoon.
The Australian dollar has fallen below $1.03 following the RBA's rate cut. Most economists are still expecting further cuts, with AMP's Shane Oliver looking for a further 0.25% cut in November and then another one in February or March 2013 to take the official cash rate to 2.75%.
All sectors of the market performed well today. These three major stocks saw rises of 2.5% or more.
Stockland (ASX: SGP.AX) shares rose 3.3% to close at AU$3.42. The property developer specializing in residential and retirement living is currently trading below its net tangible asset value of $3.68, and it may have benefited from today's rate cut and news that Australian house prices have posted their biggest rise in two years.
Goodman Group (ASX: GMG.AX) saw its shares rise 2.5%. Another real-estate manager and developer, Goodman announced today that its industrial property fund was launching a $400 million equity-raising following several initiatives to secure its longer-term investment outlook, including several property transactions that appear to have been undertaken at the low point in the cycle, giving the group room to increase its value.
Qantas Airways' (ASX: QAN.AX) share price also climbed 2.5% to end at $1.22 on news that the company had simplified its freight business by selling its 50% stake in StarTrack to Australia Post and acquire 100% of Australian air Express. The transaction will net Qantas AU$408 million and result in a profit of around AU$30 million. The shares rose despite news that the court has ruled that Qantas has to pay the Australian Tax Office the AU$34 million in goods and service taxes it collected from passengers who then didn't turn up for their flights.
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