The rally in Australian stocks is fading

Robert Allenby of Australia plays his first shot from the first tee during the first round of the Sony Open In Hawaii at Waialae Country Club. Tom Pennington/Getty Images

Australian stocks took off in early trade but started to fade by midday.

Local investors first enthusiastically followed Wall Street’s lead where the S&P 500 closed 1.7% higher overnight.

The ASX 200 was up by 1.6% with all ten sectors stronger before the rally crumbled. A short time ago, the index was 4,921.60, up 12.22 points or 0.25%.

The slide was led by the major banks which came of 2% rises to be flat. Westpac was down 0.4% to $31.03 and the Commonwealth was up just 0.2% to $79.59.

The big miners were still ahead, with BHP up 2.3% to $15.23 and Rio Tinto also 2.3% to $39.75.

A rally by energy stocks also ran out of steam. Santos was up just 0.35% to $2.87 and Woodside Petroleum 0.89% to $27.11.

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