Australia, New Zealand: Shares rally with banks leading gains
[SYDNEY] Australian shares rallied on Monday, tracking Wall Street's positive lead with banks, miners and energy companies leading gains, while New Zealand stocks were near last week's record high.
The S&P/ASX 200 index climbed 0.9 per cent, or 49.29 points, to 5,546.7 by 0252 GMT, not far from its highest since August 2015.
The benchmark fell 1.2 per cent last week, after three consecutive weeks of gains. The index is up nearly 4 per cent this year.
Financial shares bounced following last week's losses when the Reserve Bank of Australia cut its cash rate.
"The big story today really is the banks, nearly two-thirds of the increase in the index today is due to the financials,"said James McGlew, executive director of corporate stockbroking at Perth broker Argonaut.
"Quite clearly there's an expectation following last week's rate drop that their margins aren't going to be squeezed as tightly as markets were originally thinking," he said, adding that bank dividends remain high relative to deposit rates.
Macquarie Group leapt 2.6 per cent to its highest in six weeks and looked set to test a January peak.
Australia and New Zealand Banking Group added nearly 2 per cent, while National Australia Bank Ltd, Commonwealth Bank of Australia and Westpac Banking Corp each gained more than 1 per cent.
Miners were also in demand following a jump in iron ore prices.
Global miner BHP Billiton added around 2 per cent. Rio Tinto rose 1.4 per cent and Fortescue Metals 1.7 per cent.
Infrastructure services provider Downer EDI, which surged 6 per cent on Friday, was up another 6.5 per cent.
Rising oil prices underpinned energy shares. Whitehaven Coal leapt 4.5 per cent, WorleyParsons gained 3 per cent, while Woodside and Oil Search rallied around 2 per cent each.
Investors steered from the telecommunications sector. Telstra was down 0.5 per cent.
New Zealand's benchmark S&P/NZX 50 index, up on Thursday and Friday, rose 0.5 per cent or 35.14 points to 7,343.56, close to last week's record high of 7,361.93.
Outdoor equipment retailer Kathmandu rose 3.7 per cent, while Sky TV was up 2.8 per cent.
The subsidiaries of Australian banks were among the biggest gainers, with Westpac and ANZ each rising 2.6 per cent.
Casino operator Sky City, due to report full-year results on Wednesday, rose 1.3 per cent.
Property companies struggled with Precinct Property down 0.4 per cent and Kiwi Property off 0.3 per cent.
Steel goods manufacturer Steel Tube led losses, falling 1.4 per cent.
REUTERS
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