Sydney, Sept 12, 2007 (ABN Newswire) - Australian shares gained in morning trade as hopes of a rate cut in the U.S. next week buoyed U.S.-focused firms while a jump in oil and base metal prices lifted resource stocks.

At Midday the S&P/ASX200 index has gained 39 points to 6,275 and on the futures market the SPI 200's up 33.

In economic news, the Westpac-Melbourne Institute consumer sentiment index rose 4.2 per cent in September to 115.7. The index recouped over half of August's 8.1 per cent slide as strong economic data helped offset the lingering impact of higher interest rates.

The full report is available at the following video and audio links.

Video Link

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In company news this hour, Rio Tinto announced this morning it will provide Ivanhoe Mines Limited with a $350 million US dollar credit facility to help financing the Oyu Tolgoi copper gold complex in Mongolia. The company said that the credit facility is directed at maintaining the momentum of mine development activities at the mine while the group finalises an investment agreement between Ivanhoe and the state of Mongolia. Rio said that after the credit facility is provided, if it exercised all possible conversions and warrants, it would hold approximately 42.2% of Ivanhoe's common shares on a fully diluted basis. Rio Tinto shares are 0.74% higher at $98.80.

Just Group has just posted a 7.4 per cent rise in year profit before one-offs, with casual clothes outperforming women's wear. The retailer also said the outlook for this year was positive as same store sales accelerated in the second half to 5.7 per cent growth, up from 1.0 percent in the first half. Just Group, whose 810 stores also include Portmans, Jay Jays, Dotti, Peter Alexander and Jacqui E, said net profit after tax in the year to July 28 rose to $61.4 million from $57.2 million, excluding a gain on the sale of shares in Colorado Group clothing company. Just Group shares are up 1.7% higher at $4.78.

Now let's have a look at warrants from Macquarie Bank. After trading as much as 2.6 percent higher, shares in BHP Billiton were boosted on fresh US rate cut hopes. Traders prompted by the strength in the stock took gains off the table through BHPWMF Sep07 $36.50 Call and BHPIM4 Oct07 $31.00 Instalment. Boart Longyear is another stock on warrant traders' radar after its shares continued its path higher, with big lines closed out for robust gains through BLYIMG Nov07 $1.75 Instalment.

A scramble for Babcock and Brown shares early in the session also saw its stock jump sharply, prompting traders to close out long positions through BNBWMK Oct07 $28.00 Call.

Turning now to market indices. The index posting the biggest gain by percentage points is the Materials index, up 206 points at 13,836. Shares in Tamaya Resources are up 3.92% to $0.265. Shares in Mincor and Oxiana are also higher.

The Staples index is the worst performing index by percentage points and has lost 21 points to 8,221. Woolworths shares are down 0.87% to $29.59. Coca Cola Amatil and Fosters Group shares have also lost ground.

In Tokyo, the Nikkei is 115 points ahead and in New Zealand the NZSX50 is flat.

Gold is currently trading at $710.60 U.S an ounce and one Australian dollar's buying 83.34 U.S cents.


Source: Finance News Network © 2007 http://www.finnewsnetwork.com.au
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