The Australian stock market closed sharply higher, extending its gains for a second day, as bargain hunters snapped up shares in BHP Billiton and Rio Tinto, two days after BHP scrapped its takeover bid for Rio. The U.S. market remained close on Thursday on account of Thanksgiving Day holiday, while the European markets finished higher overnight. The benchmark S&P/ASX 200 index closed up 154.5 points or 4.3% at 3,742.5 and the broader All Ordinaries index rose 144.6 points or 4.1% to 3672.8. On the Sydney Futures Exchange, the December share price index contract was up 168 points at 3,736.
In the currency market, the Australian dollar ended firmer for the fifth successive session. The Aussie finished the domestic session at its highest level since November 12 of US$0.6561-0.6565 compared to Thursday's close of US$0.6500-0.6504.
Oil prices fell below $54 a barrel in Asian trading Friday, a day before an important OPEC meeting to be held in Cairo. New York's main futures contract, light sweet crude for January delivery, eased $1 to $53.44 a barrel by 1:23 a.m. ET. Oil closed at $54.44 a barrel on Wednesday in New York.
On the economic front, the Reserve Bank of Australia said that total credit provided to the private sector by financial intermediaries climbed 0.6% in October, following a rise of 0.8% seen in September. However, credit rose more than the 0.5% growth predicted by economists. Year-on-year, total credit increased 9.7%.
Big miners led the market higher. Global miner BHP Billiton surged 7.6% and rival Rio Tinto soared 8.8%. Elsewhere in the resources sector, gold miners fell on weaker gold prices in Sydney. Newcrest Mining lost 4.3% and Lihir Gold declined 3.1%. In the energy sector, Woodside Petroleum jumped 6.0%, Santos rocketed 6.9%, and Oil Search climbed 1.0%.
Banks posted sharp gains, with Westpac advancing 6.8%, ANZ gaining 5.7%, NAB climbing 5.3%, and Commonwealth Bank rising 4.1%. Diversified financials were also higher, with insurer QBE Insurance adding 5.6%. QBE announced the takeover of four firms and increased its profit forecast earlier in the week.
In the retail sector, Woolworths surged 5.5%, while Wesfatrmers edged up 0.3% and David Jones added 0.4%.
Agribusinesses ABB Grain and AWB rallied after they confirmed reports that they were in discussions over an A$2 billion merger. ABB surged 16.5% and AWB jumped 6.9%.
Virgin Blue Holdings, Australia's second-biggest airline, rose 3.2% after it reassured investors that it had no need to raise capital.
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