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Australia shares gain on strong earnings; NZ hits another record

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[SYDNEY] Australian shares climbed 0.8 per cent on Tuesday aided by broad-based gains across all sectors as sentiment was buoyed by better-than-feared results from several large companies in the earnings season so far.

The S&P/ASX 200 index rose 42.15 points to 5,557.20 by 0115 GMT. The benchmark lost 0.21 per cent on Monday.

Banks and healthcare stocks led gains, aided by strong earnings from healthcare services provider Healthscope which posted a nearly 19 per cent rise in full year profits.

Australian companies have fared well in the current earnings season which is almost halfway through, Deutsche and UBS analysts wrote in separate 'earnings review' notes.

UBS expects companies to continue to do well in the current financial year helped by a revival in commodity prices and strength in the domestic economy.

Non-resources companies, on average, have already delivered 5 per cent growth in market-cap weighted earning per share for the 2016 financial year, although the overall market is set to post an 8 per cent drop, according to a UBS research.

"Aggregate earnings trends look set to improve in FY17," UBS said.

"The bottom-up and aggregate earnings picture going into FY17 looks reasonable with the domestic economy still defying the naysayers."

Healthscope was among the top gainers on the benchmark, posting its biggest percentage gain in six months.

The "Big Four" Australian banks rose with Commonwealth Bank and National Bank of Australia up about 0.8 per cent. ANZ Banking and Westpac climbed more than one per cent.

Major miners BHP Billiton and Rio Tinto were up 0.9 per cent and 0.4 per cent respectively.

Energy shares were mixed with Oil Search off about one per cent after earnings were hit by a slump in oil prices while Origin and Santos adding 0.6 per cent.

New Zealand's benchmark S&P/NZX 50 index inched higher on Tuesday, continuing its ascent to a record of 7,481.68 points.

Honey supplier Comvita Ltd slipped as much as 5.5 per cent to its lowest since April 5 after it failed to offer any earnings guidance and flagged uncertainties due to new regulations in China, one of its largest markets.

a2 Milk Co Ltd added 3.6 per cent following a new five-year supply agreement with Synlait Milk for the production of a2 Platinum infant formula.

Fletcher Building was up one per cent while Contact Energy and Z Energy both rose about 0.7 per cent each.

REUTERS