Australia: Shares rebound as Qantas soars, bank shares rise

[SYDNEY] Australian shares rebounded on Monday with Qantas soaring to its highest in over three years after the airline said it expected to post its best first-half profit since 2010.

Qantas Airways topped the leader board with an impressive 13 per cent rally to A$2.38 as investors cheered its faster-than-anticipated turnaround from last year's record loss.

Further supporting the overall market, the banking sector made a comeback as a government-backed review calling for stronger capital levels contained no nasty surprises.

The S&P/ASX 200 index climbed 1.0 per cent to 5,389.4 by 0110 GMT, reversing all of Friday's 0.6 per cent decline.

The big four major banks were all firmer led by a 2.0 per cent rise in National Australia Bank. "The banks are maybe seeing some relief buying today on the premise that perhaps these banks are going to be more secure in the future," said Chris Weston, chief market strategist at IG in Melbourne. "The investment case for the banks is still solid. If you look at what's been driving them for the past 24 months, it has been yield and that yield play is still very much in focus."

Investors also warmed to companies that benefit from a drop in the local dollar, which slid below 83 US cents for the first time in over four years.

CSL, the world's largest blood products company, advanced 2.4 per cent, while Brambles, the world's largest supplier of pallets, climbed more than 2 per cent to A$10.43, reaching its highest in nearly seven years.

Mining names, however, stayed under pressure with investors remaining wary amid falling commodity prices and worries about global demand. Gold miner Beadell Resources slid 5.7 percent to US$0.208.

New Zealand's benchmark NZX50 index was a touch higher at 5,526.5, still within sight of a record high set two weeks ago.

The market's biggest company Fletcher Building edged up 0.2 per cent to NZ$8.52.

The strongest positive note, however, came from smaller-cap stocks, with Solution Dynamics up 14.6 per cent at NZ$0.63 on positive earnings guidance.

Refinery operator NZ Refining gained 1.8 percent to NZ$2.21.

Shares in stock exchange operator NZX eased 0.8 per cent to NZ$1.21. The company said it would pay up to NZ$35 million to buy fund manager SuperLife to expand its offering of financial products.

REUTERS