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Australia, NZ: Shares join global rally as Brexit shock fades

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[SYDNEY] Australian and New Zealand shares rallied on Wednesday, as global markets found their footing after the Brexit shock, with the Australian market gaining 0.68 per cent and NZ stocks adding 1.09 per cent.

The S&P/ASX 200 index rose 34.63 points to 5,137.9 by 0133 GMT. Miners and financials led the gains.

The S&P 500 bounced 1.8 per cent overnight after two days of hefty losses in the wake of Britain's vote to leave the European Union.

"There's a view that Brexit isn't going to damage every single sector of the Australian economy," said Aurora Funds Management senior portfolio manager Hugh Dive.

"There's also a view that we are going to see a rate cut in Australia and a view that we are going to see the Fed cutting back in the US."

US Federal Reserve governor Jerome Powell said the Brexit result had shifted global risks "to the downside".

BT Investment Mangement shares added 6.24 per cent on Wednesday, recouping some of the stock's heavy losses since Friday, which may have been as much as 27 per cent of its value.

Australia's Big Four banks all climbed, led by Australia and New Zealand Banking Group, which rose 1.55 per cent. National Australia Bank gained one per cent, Westpac Banking Corporation added 0.95 per cent and Commonwealth Bank added 0.6 per cent.

Miners BHP Billiton Ltd and Rio Tinto rose on a five-week high for the iron ore price, with BHP stocks gaining 1.9 per cent and Rio stocks adding 2.04 per cent.

Australian health, telco and energy stocks all rose, led by Origin Energy which added 2.94 per cent and Caltex , which rose 3.14 per cent, its largest intra-day gain since December, on news of a positive profit outlook.

Utilities dragged, however, with Duet Group losing 2.8 per cent and APA Group shares falling 1.67 per cent.

New Zealand's benchmark S&P/NZX 50 index rallied 1.09 per cent or 73.11 points to 6,789.69 on Wednesday as the market tracked a global equities bounce-back from the heavy losses caused by Brexit.

Accounting software company Xero led gains, rising 5.38 per cent after the firm, which earns almost a fifth of its revenue in the United Kingdom, dropped 8 per cent in the wake of the "leave" vote.

A2 Milk rose 4 per cent and Property Industries rose 2.86 per cent.

Energy companies also gained with Meridian Energy up 3.2 per cent and Genesis Energy rising 2.6 per cent.

Shares in Fonterra's fund, which provides investor exposure to the farmer-owned dairy exporter, rose 0.75 per cent.

Telecommunications company Spark led losses, edging down 0.57 per cent.