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Stocks close firmly higher as M&A boosts sentiment

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The Australian sharemarket had second straight day of solid gains on Wednesday and has now wiped out Monday’s heavy loss, as the result of positive action offshore and M&A activity at home.

At the close, the benchmark S&P/ASX 200 index had lifted 24.6 points, or 0.45 per cent, to 5,435.4, while the broader All Ordinaries index gained 26.4 points, or 0.48 per cent, to 5,518.4.

The focus through the session was a giant $11.3 billion (£9.20 billion) merger of Tabcorp and Tatts Group, which drove strong volumes in the shares of the two wagering groups.

Tabcorp jumped 3.6 per cent on news of the cash-and-scrip acquisition, while Tatts remained 7 per cent shy of the offer price despite surging 15.8 per cent, a sign investors are not yet convinced it will receive regulatory approval.

The market was driven by the gaming and wagering sector this week in light of Monday’s 13.9 plunge in Crown stock, which followed the arrest of several of its employees in China.

Paul

The author Paul