Leading the index was Mayne Pharma, which rallied 13 per cent to 73?? on the heels of generics industry leader Teva Pharmaceutical Industries, which surged 7 per cent in Tel Aviv on an asset sale proposal overnight. Wall Street rallied on Tuesday but futures indicated a soft opening for the session ahead.

On Wednesday, North Korea rejected the latest round of United Nations sanctions on the isolated state and vowed to accelerate its plans to acquire a nuclear weapon that can strike the US homeland. The Australian dollar was trading at US80.3??.

Gold producers St Barbara and Saracen Mineral Holdings rose, by 4.7 per cent to $2.90 and 3 per cent to $1.38, as the commodity trades at $US1332 an ounce. Broker Deustche Bank finds the ASX's gold index is up 15 per cent since the August earnings season and is now "fully valued" with a few exceptions.

Short-seller favourite Syrah Resources rallied 2.7 per cent to $3.77. Graincorp shares fell 4.6 per cent to $8.16.

Iron ore futures in China jumped more than 2 per cent, according to Reuters, rising with steel prices for a second day in anticipation of the peak season for demand in the world's top steel market. BHP Billiton added 1 per cent to $27.38 and Fortescue Metals lost 1 per cent to $5.84.

The Westpac Melbourne Institute Index of Consumer Sentiment rose 2.5 per cent to 97.9 in September, from 95.5 in August, but the mood remained downbeat according to top economist Bill Evans as family finances outweighed better job prospects.

What moved the market

Hotline bling

Telstra's sustainable levels of earnings in a post-NBN world is 17?? a share, according to Citigroup, in 2021-22 which is the first full year without NBN payments. The broker takes a non-consensus view in estimating that Telstra's earnings from mobile won't be as high as the market is expecting in 2019-20 onwards despite its investment in that area. If Citigroup is right, that means mobile earnings will decline by $400 million over the next five years. For a "premium" operator, Telstra currently has more price sensitive customers than normal.

Corn futures hit

Corn futures are on track for a fifth straight annual decline, the worst losing streak in decades, according to Bloomberg. Futures fell after the US government's Department of Agriculture forecast higher domestic corn yields than it did a month ago, despite weather impacted growing conditions in some parts of the country. December corn futures slumped as much as 3.4 per cent to $US3.45 a bushel on the Chicago Board of Trade on Tuesday, the lowest level this month.

Sterling grip

The British pound rose to a fresh one-year high against the US dollar ahead of the Bank of England's meeting on Thursday. The cash rate is currently 0.25 per cent, but with inflation now running at 2.9 per cent, traders are on watch for the probability of a more hawkish sounding Monetary Policy Committee. A strong employment print due on Thursday (AEST) should lead the pound to further gains, strategists say, and on some estimates Britain could see the unemployment rate at a fresh 40-year low.

Real talk

The latest consumer confidence survey has damning implications for the property market, CommSec finds. "Real estate was selected as the wisest place for savings by just 10.5 per cent of respondents - the lowest reading in 44 years," according to economist Craig James. The survey showed savings as the preferred answer for 29.3 per cent of respondents, followed by repaying debt. Property was still ahead of shares, spending and superannuation contributions.

Stock watch

Bank of Queensland

Macquarie Securities thinks shares of Bank of Queensland have run too hard. Sure, the regional banks are winners from mortgage repricing trends and the improvement in funding conditions, but "in our view BoQ's recent rerating more than captures this upside", the broker says. Trading at about 13.4 times earnings, BoQ is now at a premium to the big four banks despite having a lower return on equity and similar growth. It's also trading 2 per cent above Macquarie's valuation. BoQ's yield is still a solid 6 per cent but this is arguably undermined by unsustainable factors - an 82 per cent payout ratio. The broker rates the stock "underperform" after dropping its "outperform" recommendation and forecasts no increase in dividends until 2020.