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Australia shares rise as weaker US dollar boosts miners; NZ falls

Wednesday, February 1, 2017 - 09:57

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[BENGALURU] Australian shares rose on Wednesday, snapping two sessions of losses, as basic materials and energy stocks gained on the back of a weakening US dollar.

The greenback sagged against its major peers after US President Donald Trump and his top economics adviser took aim at the currency policies of key US trade partners, further raising concern that Washington was poised to actively weaken the US dollar.

The S&P/ASX 200 index gained 0.36 per cent, or 19.989 points to 5,640.9 at 0128 GMT.

The metals and gold indexes were both up around one per cent.

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Market voices on:

"We do have support from mining stocks," said Ric Spooner, chief market analyst, CMC Markets.

"The second thing supporting the mining sector is further upgrades for Fortescue Metals."

Brokerages Argonaut, Jefferies and Citi raised Fortescue's target price after the company said it was still on track for another bumper year.

Fortescue Metals Group Ltd rose as much as 4.7 per cent, while miner BHP Billiton PLC gained 1.4 per cent.

Newcrest Mining Ltd climbed as much as 3.1 per cent, its highest in a month, while Evolution Mining Ltd rose nearly 2 per cent.

Energy stocks also saw gains on the back of rising oil prices which, besides the US dollar movement, were further aided by news of the world's top producers cutting production more than expected this month.

Woodside Petroleum Ltd rose 1.9 per cent, while Oil Search Ltd climbed 1.5 per cent.

The gains in the mining sector helped offset market pressure from financial stocks.

Australia and New Zealand Banking Group Ltd was down 0.1 per cent, falling for the third straight session to its lowest level in nearly eight weeks. National Australia Bank Ltd fell 0.2 per cent.

There is "continued profit-taking in the banks, the big banks especially, and so that downward sentiment in profit-taking that we have seen over recent days has carried forward to today," Mr Spooner said.

New Zealand's benchmark S&P/NZX 50 index was down 0.2 per cent, or 13.43 points, at 7,037.32 in its third straight session of declines.

Financials and energy stocks led the decline as Z Energy Ltd lost 1.5 per cent in its third straight session of losses.

REUTERS

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