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Australia, New Zealand shares end up on trade optimism; banks cap gains

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[BENGALURU] Australian shares ended higher on Monday on growing signs that Washington and Beijing were inching towards a trade deal, although gains were capped by losses in major bank stocks.

The S&P/ASX 200 index rose 0.3 per cent or 17.8 points to 6,686.90 at the close of trade.

The United States and China both said on Friday that they had made progress in talks aimed at defusing their protracted trade war, while US officials said a deal could be reached this month.

Trade-sensitive resources producers in Australia, which sell most of their goods to China, were the biggest boosts to the ASX 200 for the day.

The metals and mining index closed 2.2 per cent higher, with heavyweights BHP Group and Rio Tinto adding 2.2 per cent and 3.5 per cent for the day, respectively.

Mining services provider NRW Holdings Ltd gained 13.3 per cent, and was the best performer on the ASX 200. The stock rose after NRW confirmed it was selected as the preferred bidder for a Western-Australian mining services company.

On the other hand, banking stocks were the biggest drags on the ASX 200, with three of the big four banks falling between 0.9 per cent to 2.5 per cent.

Bank stocks were sold down after Westpac Banking Corp, the second largest lender in the country by market capitalisation, reported a 15 per cent slide in full-year earnings citing challenging local conditions. The stock was on a trading halt for a US$1.73 billion capital raising.

The news comes only a few days after peer ANZ missed market expectations with its second-half profit.

The financial subindex shed 0.8 per cent, its sixth straight day of losses. National Australia Bank, which is due to report its results on Thursday, fell 2.5 per cent and was the largest loser on the index.

New Zealand stocks ended higher on strength in healthcare and utility stocks, although the local listings of Australian banks weighed. The benchmark S&P/NZX 50 index rose 0.4 per cent or 39.86 points to finish the session at 10,801.55.

Fisher & Paykel Healthcare Corp ended 2.1 per cent higher, while Meridian Energy added 1.6 per cent.

Local shares of ANZ fell 1.1 per cent.

REUTERS

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