ASX edges towards 5-year high

The market is closing in on its levels recorded in mid-May on positive economic news.

It appears that the S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) could be on its way towards a five-year high as Australia’s blue chips climb and the threat of military intervention by the US in Syria seem to have diminished slightly.

In an attempt to avoid a military attack on the country, Syria said it would cease making chemical weapons and reveal the location of its stockpiles, which has increased the sentiment within global markets.

Upbeat economic data emerging from China, such as strong export growth for August, has also pushed Australian stocks higher and the price of iron ore regained US 70 cents overnight to US$134.80 per tonne.

Mining heavyweights BHP Billiton (ASX: BHP) and Rio Tinto (ASX: RIO) were up 1% and 1.7% on the results, respectively, and Fortescue Metals Group (ASX: FMG) soared 4.9% to over $4.70 per share. Meanwhile, the major financials also performed strongly, whereby Macquarie Group (ASX: MQG) added 3.15% and the big four added between 0.3% and 0.7% each, with the exception of Westpac (ASX: WBC) which was behind 0.4%.

This morning, Australia’s benchmark index reached 5228.20 points, closing in on the five-year high of 5249.60 points set in May prior to the market’s fall.

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Motley Fool contributor Ryan Newman does not own shares in any of the companies mentioned in this article.

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