Australia Shares Hit New Five-Year High

   By Robb M. Stewart 
 

MELBOURNE, Australia--Australian shares touched fresh more-than-five-year highs Monday, mirroring gains in Asia after Larry Summers dropped out of the running to succeed Ben Bernanke as U.S. Federal Reserve Chairman.

The decision by Mr. Summers, who many investors had considered likely to quickly wind down the Fed's easy-money policy, had boosted U.S. stock futures late Sunday.

"This news is a massive shot in the arm for markets that have seen a drop-off in liquidity," said Evan Lucas, a market strategist at IG in Melbourne. Investors are positioning themselves ahead of the Fed's policy meeting this week where many expect it to begin rolling back its bond-buying program, he added.

At 0250 GMT, the S&P/ASX 200 was trading 0.6% higher at 5252.3, led by gains in mining and energy shares. The benchmark index touched an intraday high of 5266.1, topping a recent peak reached in trading last Thursday.

Market heavyweight BHP Billiton was 0.6% higher, and rival Rio Tinto was up 1%. Gold producer Newcrest Mining rallied 5.7% alongside a rise in the price of the precious metal Monday. Lynas jumped 7.4%.

The country's big retail banks also gained, with National Australia Bank climbing 1.4%. Investment bank Macquarie Group was 2% higher.

Westfield Group advanced 0.2% after saying it was selling seven shopping malls in the U.S. for a combined US$1.64 billion.

Write to Robb M. Stewart at [e-mail]

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