Australia shares end higher on boost from China PMI; NZ up for 8th month

[BENGALURU] Australian shares closed higher on Thursday, as a survey showing robust Chinese factory activity drove up metal prices in a boost to the mining sector, lifting a related index to a three-year high.

Chinese rebar steel futures trimmed losses and were on track to post their fourth monthly gain in a row, while Shanghai Futures Exchange copper and Iron ore futures also gained.

Metal prices gained after a survey showed factory growth in China, Australia's biggest export market, unexpectedly accelerated in August and underpinned the outlook for steel demand.

That helped the S&P/ASX 200 index end up 0.8 per cent, or 44.779 points, at 5714.5. The benchmark, however, was down 0.1 per cent in August for its fourth month of losses.

The metal and mining index closed 1.06 per cent higher, while the materials index ended at a 3-1/2-year high.

Global miner and index heavyweight BHP Billiton Ltd jumped 1.7 per cent.

"I think the commodity markets are looking to the fact that the main reason commodity prices fell overnight was strength in the US dollar. There's no change to the demand scenario globally, nor any on the supply side," said Michael McCarthy, chief market strategist at CMC Markets.

The financial index snapped six straight sessions of losses to close 0.7 per cent higher.

Australia and New Zealand Banking Group Ltd rose 1.2 per cent, while Commonwealth Bank of Australia recouped some of its losses to close 0.6 per cent higher.

Shares of CBA have been under relentless pressure, most recently when the Australian Prudential Regulation Authority (APRA) on Monday said it would establish an inquiry into the bank, following its alleged breaches of money-laundering and counter-terrorism finance rules.

New Zealand's benchmark S&P/NZX 50 index ended 0.5 per cent higher, or 41.9 points, at 7817.1 to record its eighth straight month of gains.

Gains in utilities, health care and industrial sectors pushed up the index.

Auckland International Airport Ltd and Contact Energy ended 1.8 per cent and 2.4 per cent higher, respectively.

REUTERS