Catch-up gives Oz banks a boost

SYDNEY bank stocks rose on talk that they had largely been overlooked in recent sessions.

The sector's advance helped Australia's All Ordinaries index nudge higher despite a setback overnight on Wall Street and a corresponding decline for media giant News Corporation.

ANZ Banking Group gained 16 cents or 0.9% to A$18.10, and Westpac Banking was up 10 cents or 0.6% at A$16.26. National Australia Bank (NAB) performed best of all, rising 40 cents or 1.3% to A$31.

The sector is in a state of flux as leading counters thrash out possible acquisitions. ANZ remains the only player to have formally stated its interest in having a crack at buying National Bank of New Zealand, the unit put up for sale by Lloyds TSB. However, some market watchers have suggested it may be rethinking. If so, it would join Westpac, which has already dropped out of the running for NBNZ.

To complicate the picture, there is struggling financial group AMP, which was 7 cents or 1% lighter at A$6.61. AMP wants to hive off its faltering British units, but there are questions about whether that will be done this year.

NAB took a bite at AMP this month, raising its stake to 5.4% but failed to pick up the full 11% it wanted. NAB executives have talked of a merger - once the British units are offloaded. To add extra spice, there is now talk that Westpac may be mulling its own attack on AMP. Now that it has cleared the decks by ruling it out any move for NBNZ, it should have the time and resources to put something together, should it be so inclined.

News Corp, which generates a substantial portion of its revenue in the US, backtracked after Wall Street's stumble, dipping eight cents or 0.6% to A$13.01. The All Ordinaries index advanced 3.5 points to 3225.0.

Japanese equities pulled back from 15-month highs in Tokyo, undermined by profit-taking and fears that any significant resurgence in the yen could deal a hefty blow to exporters.

The same pair of opposing forces - a stronger economy boosts shares, but a correspondingly more robust yen weakens them - has pushed and pulled the Nikkei 225 in recent months.

Carmakers felt the pain today. Nissan gave up 39 yen or 2.7% to 1398; Toyota dropped 160 yen or 4.1% to 3730 yen; and Honda eased 180 yen or 3.3% to 5320. Currency fears also hit consumer electronics player Sony, off 120 yen or 2.7% at 4290. The Nikkei 225 closed 43.21 points higher at 11,033.32.

Loss-making State-linked chip maker Chartered Semiconductor stole the limelight in Singapore. The stock galloped higher on Wednesday on speculation that Singapore Technologies was set to sell some of its controlling stake to a significant new partner. Those rumours were quashed today, and the shares dropped three cents or 2% to S$1.42. The Straits Times index closed unchanged at 1602.8.

Prices and indices in this section are supplied from various sources and calculated at different times and may not always match those listed on the site.