BHP Billiton touches new peak

Australian shares were firmer in midmorning trade Monday, led by BHP Billiton which reached a fresh record high.

Bell Potter Securities private client advisor Stuart Smith said gains on Wall Street Friday following the release of positive US jobs data set the market up for a positive start to trading this week though banks

were a mixed bag.

'There's a bit of concern about rising bond yields so that's hurting the banking sector,' Smith said.

At 11.30 am (0130 GMT), the S&P/ASX 200 was up 32.1 points or 0.51 percent at 6,383.2, narrowing the gap from the all time intraday high of 6,403.9, set on June 20.

The All Ordinaries Index advanced 35.9 points or 0.56 percent to 6,418.9.

Shares of BHP, the world's largest diversified resources group, gained 96 cents or 2.56 percent to 38.50 Australian dollars, having reached an all-time high of 38.51 dollars earlier in the session. Rio Tinto was up 65 cents or 0.64 percent at 102.70 dollars.

UBS analysts said in a research note that for the year to date, BHP has outperformed its peers, probably because of its 10-billion-US dollar share buyback announced in February and the continued rise in oil prices.

BHP was also the worst performing stock among its peers in 2006, so there is some catch-up, they said. BHP's market valuation remains attractive to investors as the stock was trading at only 10.5 times forecast earnings for the year to June 2008 before this morning's rise, UBS analysts said.

Among the banks, ANZ was down fours cents at 29.35 Australian dollars after announcing the purchase of a 10 percent stake in Vietnamese investment banking and securities business, Saigon Securities Inc, for 88 million US dollars.

National Australia Bank dropped 16 cents to 39.98 Australian dollars but Commonwealth Bank edged up 45 cents to 55.73 dollars.

source:forbes.com