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Australia: Shares edge up despite Telstra's tumble; New Zealand hits record high

[BENGALURU] Australian stocks inched up on Thursday, although a plunge by Telstra after it slashed dividends offset most of the gains by materials shares.

At 0253 GMT, the S&P/ASX 200 index was up 0.15 per cent or 8.5 points to 5,793.6 by 0253 GMT.

Thursday's advance was underpinned by material stocks, with global miners BHP Billiton and Rio Tinto rising 1.1 per cent and 1.7 per cent respectively after copper and aluminium prices hit their highest since 2014 on a wave of speculative buying.

Another gainer was Treasury Wine Estates whose shares jumped as much as 7 per cent to a seven-week high after it reported a surge in annual profit.

On a busy day of earnings, Wesfarmers posted a record annual profit boosted by its coal and home improvement units, sending the shares of the retail-to-mining conglomerate up as much 3.2 per cent to a near three-month high.

Among other blue chips, CSL Ltd was up 2.1 per cent while Qantas Airways Ltd gained 1 per cent.

Telstra was the biggest drag on the index, plummeting as much as 12 per cent to a near five-year low after saying it would trim dividends by 30 per cent this financial year, the first cut since Australia's biggest telecoms firm got listed in 1997.

"Markets are responding to Telstra's capital management, its low dividend and the reduction in its dividend guidance. They were surprised by it cutting the dividend," said Adam Tout, a senior analyst at CPS Capital in Perth. "They were surprised by it cutting the dividend."

Telstra said it is facing headwinds from a new state-owned National Broadband Network, which will replace the telecom giant's copper lines by about 2020.

QBE Insurance Group fell as much as 6.7 per cent to its lowest since November. Australia's biggest insurer said its overall payout ratio worsened due to a claims blowout in its emerging markets unit.

Advancing issues outnumbered declining ones by a 1.3-to-1 ratio.

New Zealand's benchmark S&P/NZX 50 index, reaching a record, rose 0.2 per cent, or 15.12 points, to 7,868.46.

Healthcare stocks accounted for more than one-fourth of the gains, with Fisher & Paykel Healthcare and Metlifecare advancing 1.6 per cent and 1 per cent respectively.

Sentiment in the broader market was lifted by a survey showing consumer confidence in New Zealand rebounded in August as low unemployment, recovering dairy prices and a high New Zealand dollar made imports cheaper and boosted household optimism.