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Australia, NZ: Shares edge up on oil price rise

Wednesday, November 16, 2016 - 09:50

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[BENGALURU] Australian shares overcame two straight sessions of losses to rise slightly on Wednesday, in step with Wall Street, with energy stocks leading on oil price gains, although the strong dollar weighed on basic materials counters.

Oil prices jumped six per cent overnight on renewed expectations that Opec members will agree to cut output when they meet later this month.

The S&P/ASX 200 index rose 0.2 per cent, at 5,335.5 at 0134 GMT. The benchmark fell 0.37 per cent in the previous session.

Woodside Petroleum Ltd rose as much as 3.8 per cent to hit its highest in more than a month.

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The energy index rose nearly three per cent with and Oil Search Ltd and Origin Energy Ltd hitting three-week highs.

"I think we probably have a bit of a bounce today because oil and commodity prices are still quite high and the US markets held up better than expected," said Mathan Somasundaram, analyst at stockbroker Baillieu Holst.

Australia's top miners BHP Billiton and Rio Tinto weighed most on the index under the pressure of a strong US dollar, extending their losses to a third straight session.

The dollar rose on Tuesday to an 11-month high against a basket of currencies, with higher-than-expected October US retail sales lifting bond yields to 10-month peaks and adding to the case for an interest rate hike next month.

Fortescue Metals Group Ltd fell about three per cent after iron ore futures in Asia dropped sharply on Tuesday.

Meanwhile the gold stocks index was up three per cent as global gold prices edged up.

The ASX financials index rose as much as 0.6 per cent to its highest in more than three weeks.

The "Big Four" banks were among the top contributors to the main index.

New Zealand's benchmark S&P/NZX 50 index rose 0.8 per cent to 6,821.03, with gains were led by utilities and healthcare sectors.

Retirement village operator Summerset Group Holdings Ltd was the top performer, rising more than four per cent.

Utilities Infratil Ltd, Vector Ltd and Genesis Energy Ltd were among the top five gainers.

A powerful earthquake 7.8 struck the South Island on Sunday causing extensive damage, with repairs expected to run to billions of US dollars.

Fletcher Building Ltd rose as much as two per cent to its highest in eight weeks.

Fletcher was heavily involved in reconstruction work after severe earthquakes in 2010 and 2011.

REUTERS

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