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Australia: Shares end at over 2-month high on economic recovery hopes

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Australian shares closed at a more than two-month high on Tuesday, led by gains in mining, energy and financial stocks, as a gradual re-opening of some economies boosted sentiment and raised hopes of a demand recovery for commodities.

[SYDNEY] Australian shares closed at a more than two-month high on Tuesday, led by gains in mining, energy and financial stocks, as a gradual re-opening of some economies boosted sentiment and raised hopes of a demand recovery for commodities.

The S&P/ASX 200 index closed 1.81 per cent higher at 5,559.5, its highest close since March 11.

"Rising commodity prices are the main driver of the movement today... hopes of a recovery in demand persists," said Mathan Somasundaram, market portfolio strategist at Blue Ocean Equities.

While firmer Chinese iron ore futures that rose on hopes of more stimulus pushed up miners, energy stocks gained following higher oil prices overnight due to signs that producers are cutting output amid a steady re-opening of economies.

Earlier in the session, sentiment was helped by a robust Wall Street performance overnight on encouraging data for a potential Covid-19 vaccine.

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"Though the domestic market did follow the vaccine's trial results, the optimism will likely not last as underlying economic conditions in the US remain dire", Mr Somasundaram added.

The number of issues on the ASX that advanced were 1,132 while 574 declined.

New Zealand's benchmark S&P/NZX 50 index ended 0.3 per cent higher on the back of gains in financial and utility stocks.

REUTERS

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