Australian stocks: Miners lead stocks to record highs

SYDNEY - Australian stocks rose 0.4 per cent on Thursday, touching a record high, led by miners BHP Billiton and Rio Tinto as concerns eased about a recent interest rate hike in China cooling demand too sharply.

The benchmark S&P/ASX 200 Index closed up 16.9 points at 3,863.3, according to the latest available data, a record closing high. The index set a fresh intraday high of 3,866.7 just 21 minutes after trading opened.

"BHP and Rio have been a little bit sluggish just in the last few days, but they gained strength overnight in London trading, and the support for the stocks there has been reflected here," Shaw Stockbroking senior dealer Jamie Spiteri said.
BHP, the world's biggest diversified miner, closed up 1.4 per cent at A$14.29 and Rio was 1.4 per cent higher at A$38.19.

National Australia Bank rose 0.7 per cent to A$28.39 to also help the broader market, despite analysts cutting earnings estimates after the bank issued a profit warning on Wednesday.

Goldman Sachs JBWere said it was becoming more difficult to keep its "underperform" rating on the National "given investor appetite for turnaround stories in a fully priced market".

"An attractive dividend underpins reasonable buying support," said Spiteri, adding that the potential sale of its Irish banks should deliver enough capital to help with other parts of the business.

The Australian unemployment rate fell to 5.3 per cent in October, its lowest level since the monthly labour force series started in 1978, putting the focus on wages growth. Higher wages eat into corporate profits and raise the risk of rate rises. The equities market shrugged off those risks.

Retailer Coles Myer rose 1 per cent to A$9.86 after saying its first quarter sales rose 20.7 per cent to A$8.5 billion ($6.4 billion), driven by strong food and liquor sales, and signalled solid annual profit growth this year and next.

Oil producers Woodside Petroleum and Santos gained 1.6 per cent to A$18.89 and 1.2 per cent to A$8.15 respectively after an oil price rally.

Builder Leighton Holdings rose 0.3 per cent to A$11.00 after saying its first-quarter results were in line with expectations and its year profit would be about A$180 million.

Slot machine maker Aristocrat Leisure fell 0.2 per cent to A$8.88 after Smith Barney put a "sell" recommendation on the company due to its stretched stock valuations.