SYDNEY: Australian stocks rose 0.5 percent on Monday morning in light trading as firmer metal prices offset caution over the potential impact of a cyclone on mining shipments, keeping the market on track to post the biggest annual gain in four years.
The S&P/ASX 200 index rose 25.2 points to 5,349.3 by 0050 GMT, just 108 points away from the 5-1/2 year high of 5,457.3 hit on Oct. 28. With just one and a half days of trading remaining before the end of 2013, the benchmark has gained 15 percent in the year, and looks set to post the biggest annual gain in four years.
The benchmark pulled away from a one-month high hit on Friday when copper prices rose to their highest in more than four months. Gold prices also edged up.
BHP Billiton climbed 1.0 percent while Rio Tinto gained 1.1 percent. Gold miner Newcrest Mining Ltd advanced 2.2 percent.
On Monday analysts said investors were keeping an eye on the cyclone season in Australia, which might impact ports in the resource-rich Pilbara region.
Cape Lambert and Dampier ports, used by Rio Tinto, as well as Port Hedland, used by BHP Billiton and Fortescue Metals , stopped loading on Sunday as an intensifying tropical cyclone was expected to reach the coast late on Monday.
"Despite temporary disruption to iron ore shipments from the Pilbara, holiday season traders will be encouraged by ongoing gains in base metals and oil as we head into a new year in which world economic growth is expected to improve," said Ric Spooner, chief market analyst at CMC Markets.
In a highlight of an otherwise steady session, Forge Group's shares were up 38 percent - soaring as much as 88 percent at one point - after the engineering firm said it received formal clearance for a processing facility contract at the Roy Hill iron ore mine project in Western Australia.
Volume was still subdued as most investors were away on holiday, said Evan Lucas, market strategist at IG, noting the market will be open for a shortened session on Tuesday, New Year's Eve.
"With only one and a half trading days left in 2013 the market is likely to finish year above 5300 for the first time since 2007," Lucas said in a note to clients.
Australia's big four banks, heavyweights in the benchmark index, traded higher. The country's top lender, Commonwealth Bank of Australia, added 0.3 percent while Westpac Banking Corp rose 0.5 percent.
Department stores Myer Holdings Ltd and David Jones Ltd rose 1.5 percent and 0.2 percent respectively, supported by Christmas and holiday sales.
Leighton Holdings Ltd fell 0.9 percent on concern that its A$99 million ($88 million) purchase of Welspun Group's 39.9 percent stake in an Indian-based joint venture would have a negative impact of about A$70 million on its net profit after tax for 2013.
New Zealand's benchmark NZX 50 index edged up 0.1 percent to 4,770.6.
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