Australian shares gained on Friday as miners bounced back on higher metal prices, while financials and utility stocks rounded off a relatively solid morning session.
Australian shares gained on Friday as miners bounced back on higher metal prices, while financials and utility stocks rounded off a relatively solid morning session. The S&P/ASX 200 index rose for the second day in a row, up 0.76 percent, or 44.11 points, to 5865.5 by 0245 GMT. The benchmark, however, was on track for a weekly fall.
A recovery in prices of iron ore and steel futures in China, Australia’s major trading partner, reinvigorated material stocks, which were under pressure on worries about a growing production glut. Base metal prices gained on Thursday as investors, speculators and consumers resumed buying after recent losses, expecting increased seasonal demand. The market was also supported by Wall Street, which rallied overnight on strong corporate earnings, and as traders cheered news that the U.S. tax reform is finally underway.
“It is very much a story of miners and banks today,” said Ben Le Brun, a market analyst at OptionsXpress in Sydney. Positioning ahead of banks’ earnings underpinned financial stocks, he said.
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Materials and financials were the top perfomers on the benchmark. Big miners BHP Billiton and Rio Tinto rose to more than a one-week high. Nickel miner Western Areas was the top gainer on the metal index, rising 8.1 percent. Financial stocks traded higher for a second session, with the ‘big four’ banks rising between 0.8 percent-1.3 percent at one point. Utility shares complemented the gains, with shares of DUET Group surging to its highest level in 8-1/2 years.
DUET said the Australian government gave the green light to the company’s $5.5 billion takeover by Cheung Kong Infrastructure (CKI) consortium. There had been concerns the government could reject the deal after it last year blocked CKI from buying a state-owned power grid, Ausgrid, on the grounds of “national security”.
New Zealand’s benchmark S&P/NZX 50 index rose 0.5 percent, or 37.73 points, to 7225.78 at 0250 GMT. Consumer stocks and healthcare shares led the gains. a2 Milk Company Ltd was the top gainer on the benchmark index, rising 3.5 percent. Fisher & Paykel Healthcare Corporation Ltd added 1.3 percent.
(Reporting by Anusha Ravindranath in Bengaluru; Additional reporting by Hanna Paul; Editing by Shri Navaratnam)