Australia, New Zealand: Shares climb as US announces plan to reopen

[BENGALURU] Australia and New Zealand stocks rose to their highest levels in more than a month on Friday as new guidelines allowing for a reopening of the US economy supported risk sentiment and eased some concerns over the fallout from the coronavirus outbreak.

The Aussie S&P/ASX 200 index climbed 1.9 per cent to 5,518 by 0037 GMT, its highest since March 12.

New Zealand's benchmark S&P/NZX 50 index gained 2.4 per cent to 10,725.2, rising for a fourth straight session. The bourse was on course for its biggest weekly gain ever.

Dealers are lapping up details of US President Donald Trump's plans to revive the economy and planemaker Boeing restarting some operations next week, said Stephen Innes, chief global markets strategist at AxiCorp.

A report that severe Covid-19 patients were positively responding to an experimental treatment of US drugmaker Gilead also boosted risk sentiment, though the company played down the report.

"This is providing a more than suitable lead-in for what could be sobering assessment when China GDP gets delivered later this morning," Mr Innes said.

A Reuters poll showed the coronavirus pandemic likely knocked China's economy into its first decline since at least 1992 in the first quarter.

The data is "expected to be ugly, capturing the enormous outbreak-related disruption seen over the quarter," analysts at ANZ Research said.

Away from macro-economic developments, shares of Rio Tinto advanced 3 per cent after the world's largest iron ore miner reported higher first-quarter shipments and said demand in China continued to recover.

But Coca-Cola Amatil underperformed with a 3 per cent fall after the soft drinks bottler withdrew its dividend payout forecast.

Market participants also took heart from a drop in weekly US jobless claims, even as a record 22 million Americans sought unemployment benefits in the last month.

Rising unemployment stateside is likely to strike a chord in Australia, where economists warn the full scale of job losses amid virus-induced shutdowns will become apparent in the coming months and the economy looks poised for its first recession in three decades.

REUTERS