The S&P/ASX 200 index finished the day up 0.25% or 10.80 points to 4258.20 while the All Ordinaries followed suit, gaining 10.30 points to 4324.10.

As for our closest and largest trading partner China, its MSCI index has fallen for a third day, the longest streak of losses in almost seven weeks.

While inflation may continue to moderate, “the foundation of price stability is not yet solid,”Bloomberg quoted the People’s Bank of China from its third quarter monetary policy report.

The bank said the spread of the euro zone’s debt woes to “core countries” in the 17-nation group may cause “systemic risks” in the global economy.

“The problem really resides with the European banking sector,”Bloomberg quoted Hong Kong-based Baring Asset Management head of multi-asset strategy Khiem Do.

“Something has to happen in terms of the policy regarding the sovereign debt issue in Europe, otherwise I’m afraid equity market indices might revisit the lows again.”

Other bid news today was the auctioning by France of as much as €8.2 billion of debt after yields on the nation’s 10-year bonds rose yesterday to a euro-era record relative to benchmark German bunds.

Spain is issuing as much as €4 billion of a new benchmark security maturing in January 2022.

Wall Street set the scene overnight with the Dow Jones Industrial Average shedding 1.58% or 190.57 points to 11,905.59 and the S&P 500 index falling 1.66% or 20.90 points to 1236.91.

The major miners also ended in positive territory with shares in BHP Billiton up A39c to $37.04 after announcing it had approved the development of a $US597 million ($A593 million) power station for its Western Australia iron ore operations and a $3 billion bond issue at its annual general meeting today, while Rio Tinto jumped 42c to $68.07.

Fortescue Metals Group gained 9c to $4.91, OZ Minerals jumped 3c to $11.13 and Paladin Energy closed 5.5c lower on $1.575.

Gold stocks were mixed with Australia’s largest locally owned miner Newcrest Mining gaining 7c to $36.62, while Kingsgate Consolidated shed 9c to $6.81.

Gold producer Northern Star Resources had a good day after its shares spiked by as much as 18% to 88c on news it has hit what could be a repeat of its Paulsens orebody in the Pilbara in a nearby quartz lode, while drilling at the Voyager 2 lode hit a bonanza 12,178 grams per tonne gold.

Shares in Castlemaine Goldfields were also placed in a trading halt pending a revised mine plan and funding requirements for its Ballarat gold mine in Victoria.

The wooden spoon of the day went to Platinum Australia whose shares dropped by nearly 27% or A4.5c to 12.5c after announcing an institutional placement of up to 25 million ordinary shares to raise $3 million and a one for 12 renounceable pro-rata entitlement to raise a further $4.3 million.

At 4.14pm (AEDT) the spot price of gold was down marginally to $US1761.80 an ounce while the Australian dollar was fetching $US1.01.

– with Bloomberg