Australia, New Zealand: Shares keep gains as investors seek Trump benefits

[BENGALURU] Australia and New Zealand shares held onto gains made in the previous session, with financial stocks among the leading gainers on Friday as investors found grounds for optimism among some of President-elect Donald Trump's economic policies.

The S&P/ASX 200 index gained 0.3 per cent, or 18.665 points to 5347.500 by 1237 GMT. The benchmark had closed 3.3 per cent higher on Thursday.

As the initial bearish reaction to Mr Trump's shock victory subsided, investors have turned their attention to his likely priorities. Those included bank deregulation, generous tax cuts and increased defense and infrastructure spending, and the likelihood that the looser fiscal policy will lead to inflation and interest rate rises.

Financial stocks were the star performers, with the "Big 4" topping the lists, gaining around 2 per cent to 3 per cent. Commonwealth Bank of Australia, the country's biggest bank by market cap, rose to its highest in over two weeks, gaining as much as 2.5 per cent.

S&P ASX Financials (GIC) rose as much as 1.9 per cent in early trade.

"Materials are doing reasonably well over the expectations of more progress(ive) policy out of the US," Damien Hennessy, co founder of Heuristic Investment Systems, said.

Copper rose to a near 16-month high on expectations that the Republican presidency could unleash a flood of infrastructure spending.

Iron ore surged 4.7 per cent to its highest since Jan 2015.

Material stocks also brightened up with mining heavyweights BHP Billiton and Rio Tinto Ltd gaining more than 2 per cent.

Mining giant South32 Ltd jumped 4.8 per cent, its highest in almost 19 years.

At the same time, gold prices took a beating, falling more than 5 per cent after the US dollar rose to a 3-1/2 month high on speculation regarding Mr Trump's economic policies.

New Zealand's benchmark S&P/NZX 50 index was up 34.840 points, or 0.5 per cent,at 6,768.56 as of 1012 GMT.

Healthcare stocks have led gains in that market since Thursday, with Fisher and Paykel Health Corporation up 1.1 per cent. Material stocks also helped gains with Fletcher Building Ltd rising almost one per cent.

REUTERS