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Australia shares rise on higher commodity prices; NZ flat

Wednesday, June 28, 2017 - 12:47

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[BENGALURU] Australian shares recouped early losses to trade higher on Wednesday with miners among the biggest gainers following a rise in commodity prices.

The S&P/ASX 200 index was up 0.3 per cent or 19.7 points to 5,733.90 at 0321 GMT. The benchmark has risen 0.2 per cent this month.

Higher commodity prices helped the materials and the energy sectors as the US dollar took a significant backwards step on Tuesday after the euro gained, said Ben Le Brun, a market analyst at OptionsXpress.

The euro rose to a 10-month high after European Central Bank President Mario Draghi signalled it will reduce stimulus later this year.

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Among commodities, oil rose for the fourth consecutive session on Tuesday while gold bounced back from a six-week low.

Chinese iron ore prices surged 6 per cent to one-month highs on Tuesday in a late burst of short covering and fresh buying that lifted steel and raw materials.

Australia's metals and mining index rose as much as 1.5 per cent to a two-week high, on track to extend gains into a fifth session. Anglo-Australian miners BHP Billiton Ltd and Rio Tinto Ltd gained 1.8 per cent and 1.7 per cent respectively.

South32 Ltd rose 4 per cent and Fortescue Metals Group climbed 3.9 per cent.

The financial sector also contributed to the gains on the benchmark. Insurance Australia Group Ltd rose as much as 4.8 per cent, to a record high, after it upgraded its margin forecast for full-year 2017.

However, three of the "Big-Four" lenders declined marginally.

Losses in the industrial sector capped gains on the benchmark with Transurban Group falling 1.6 per cent and Sydney Airport Holdings declining 1.5 per cent.

Though the market largely shrugged off losses on Wall Street triggered by the delay in a healthcare bill vote in the US Senate, Australia's health care sector tracked its US peers lower.

CSL Ltd dropped 0.6 per cent while Ansell Ltd shed 1.3 per cent.

New Zealand's benchmark S&P/NZX 50 index was off a marginal 0.04 per cent or 2.78 points to 7,623.57.

New Zealand's central bank said saw the economic growth outlook as positive, but international uncertainties remained and the strong housing market was still a risk.

Losses in consumer discretionary shares were offset by the gains in materials stocks.

Retailer Kathmandu Holdings Ltd and A2 Milk Company Ltd were the top losers on the index, falling 2.4 per cent and 2.2 per cent, respectively.

REUTERS

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