Kagara, Ausenco, Aquila Shares Advance on Confidence in Global Recovery
Kagara Ltd. and Ausenco Ltd. led mining-related shares higher in Sydney trading after the Federal Reserve pledged to safeguard the U.S. economic recovery, boosting the prospects for Australia’s commodity exports.
Kagara jumped 11 percent to 66 Australian cents at the 4:10 p.m. close of trading on the Australian stock exchange. Ausenco surged 8.5 percent to A$2.30. Aquila Resources Ltd. climbed 6.2 percent to A$8.76. BHP Billiton Ltd., the world’s biggest mining company, gained 1.5 percent to A$37.87.
“What we’re seeing here is a big rebound in confidence,” said Ben Potter, an analyst at IG Markets Ltd. in Melbourne. “Mid-tier mining stocks tend to bounce harder than the bigger ones. They bounce harder and fall harder.”
Federal Reserve Chairman Ben S. Bernanke said on Aug. 27 that the central bank has the tools to prevent the U.S. economy slipping back into recession. Shares in BHP have fallen 12 percent this year on concern a weakening U.S. economy, Europe’s sovereign debt crisis, and China’s steps to curb property-price growth will crimp global growth. Kagara has slumped 37 percent this year and Ausenco has shed 50 percent.