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Australian shares close at new record highs on Fed decision, metal prices

Australian shares close at new record highs on Fed decision, metal prices

SYDNEY (XFN-ASIA) – Share prices closed at new record highs as investor sentiment was boosted by the overnight decision of the FOMC to leave interest rates unchanged at 5.25 pct, and to paint a brighter outlook for US economic growth and inflation, dealers said.

They added that the overnight rise of base metal prices supported the resources sector while leading banks also gained.

The S&P;/ASX 200 advanced 40.7 points or 0.70 pct to a record close of of 5,814.1, just beating Tuesday’s record close of 5,812.5. The key index closed off the day’s high of 5,816.2 and above the day’s low of 5,781.3.

The broader All Ordinaries index rose 39.1 points to a new record close of 5,796.8, surpassing Tuesday’s record of 5,791.5.

Dealers said diversified global miner Rio Tinto climbed ahead of an expected record annual profit of around 7.4 bln usd for 2006 due to be announced at 0600 GMT.

News of a planned 860 mln usd expansion of the Cape Lambert iron ore export port in Western Australia’s Pilbara region, also underpinned the stock’s gains.

However, Rio Tinto majority-owned uranium miner Energy Resources of Australia fell after reporting a 19.7 pct drop in 2006 production from its Ranger mine.

Alumina rose after reporting a 62 pct rise in 2006 net profit to 511 mln aud.

Construction group Leighton Holdings, advanced on its plans to acquire 40 pct of property developer Devine for 94.7 mln aud.

(1 usd = 1.29 aud)

paul.daniel@xfn.com

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