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Australia: Shares up as banks bounce, NZ keeps rising

Thursday, March 31, 2016 - 09:29

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[SYDNEY] Australian shares bounced 1.5 per cent on Thursday as the benchmark index made its biggest daily rise in a month buoyed by gains on Wall Street and fund demand ahead of the new month and quarter.

The S&P/ASX 200 index rose 76.5 points to 5085.9 by 0110 GMT. Breadth was bullish with 180 stocks up and only 18 lower.

Sentiment was soothed by expectations the Federal Reserve would proceed slowly on any further increases in US interest rates, which lifted the S&P 500 to a three-month peak.

The CBOE Market Volatility Index, Wall Street's "fear gauge", hit its lowest level since August, just before fears of a financial crisis in China sparked turmoil in global markets.

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Local gains were led by a rebound in banks, which had taken a beating in recent days on concerns about potential increases in bad debts. Commonwealth Bank of Australia was the single largest points contributor to the index with an increase of 1.7 per cent.

Resource stocks also rallied, with BHP Billiton up 3.4 per cent after a very strong run in London overnight.

The rise came even as commodity prices failed to benefit from a decline in the US dollar. Iron ore, copper and oil prices were all trading lower amid doubts about global demand.

Genworth Mortgage Insurance Australia jumped over 4 per cent after announcing a payment to shareholders of 34 cents per share.

New Zealand's benchmark S&P/NZX 50 index inched up 0.3 per cent or 22.21 points to 6,736.37 on Thursday.

The index hit another record as it has done nearly every day in March as low interest rates lured investors away from bank deposits.

Health software company Orion Healthcare led gains, rising 6.15 per cent after signing an agreement with a major US health insurer.

Milk company Synlait rose 3.61 per cent after its half-year results showed a boost in infant formula sales.

Air New Zealand lost 1.05 per cent. On Wednesday the company announced that it was mulling its 26 per cent stake in Virgin Australia Holdings.

REUTERS

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