The Australian share market was stronger at noon despite lacklustre overnight leads with mining stocks finding favour following a sharp rise in spot iron ore prices.
At 01:05 AEDT, the benchmark S&P/ASX200 was up 34.5 points to 4688.6 points, while the broader ASX All Ordinaries index had gained 33.6 points to 4694 points, reflecting gains in the financial markets across the Asia-Pacific region.
NYMEX West Texas Intermediate crude oil futures for front month delivery on Globex were quoted at US$91.34 a barrel, up from prior settlement of $90.87 a barrel, while Brent futures were trading at $111.10 a barrel, up from the settlement at $110.80 a barrel.
While the broader market awaits further cues on the progress of negotiations on the federal budget in the U.S., mining stocks, especially pure iron ore plays, took lead from the spot prices that reached 8-month highs yesterday.
Spot iron ore prices for China delivery were quoted at $139.40 per dry ton, having come off significant lows two months ago.
Among the big miners that posted gains were BHP Billiton (ASX:BHP) which gained 1.24% to $37.45 a share, while Rio Tinto (ASX: RIO) added on $1.12 to trade at $66.57.
Shares in Fortescue were trading at $4.60 while Atlas was quoted at $1.77.
Iron ore stocks have gained in the last month on the back of strong spot prices and falling inventories in China, where domestic production has slackened in recent months.
Customs data in China showed that inventories were at their lowest level in two years with stockpiles at major ports down 3.3% to 71.32 metric tons.
Analysts believe that an outcome to the U.S. budget talks is crucial to providing direction to the markets.
Congressional leaders are slated to meet president Barack Obama later today in a last ditch effort to stave off a return to recession and save taxpayers and those on welfare from austerity measures set to strike if there is no deal on a budget reconciliation.
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