3 Jun 2009

Market boosted as Australia avoids recession

11:45 pm on 3 June 2009

The Australian share market rose through the 4,000 level to close at a seven-month high on Wednesday, led by property stocks as data showed the economy had avoided a recession.

Exports and household spending helped the Australian economy grow modestly in the March quarter, and avoid a much feared recession - at least in a statistical sense.

The national accounts released on Wednesday showed gross domestic product rose 0.4% in the March quarter.

A recession is defined as two consecutive negative quarters of growth.

In the year to March, the economy grew by 0.4%. The December quarter GDP was downgraded further to show a 0.6%contraction from an original 0.5% fall.

The benchmark S&P/ASX200 increased 61.9 points, or 1.56%, to 4,017.2, while the broader All Ordinaries gained 61.2 points, or 1.55%, to 4,009.3, the highest close since 10 November.

In New Zealand, the benchmark index was up 33 points, or 1.2%, to 2840 on turnover of $107 million.

Telecom was down 3 cents to $2.59, Fletcher Building soared 20c to $6.98 and Contact Energy gained 22c to $6.

Japanese share prices closed up slightly, as profit-taking tempered a sixth day of gains sparked by optimism over the state of the global economy.

The benchmark Nikkei-225 index rose 37.36 points, or 0.38%, to 9,741.67. The broader Topix index of all first section shares rose 0.94 points, or 0.10%, to 914.50.