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Australia: Shares join global rally on vaccine hopes; tourism, oil stocks take off
[BENGALURU] Stock markets in Australia and New Zealand jumped more than 2 per cent on Tuesday, joining a global rally in equities overnight as investor risk appetite was boosted by promising developments toward a coronavirus vaccine.
The Australian benchmark index hit its highest level since March 5, led by gains for travel, leisure and energy firms, while gold-related stocks plunged as investors dumped the safe-haven bullion in favour of riskier assets.
Global markets rallied sharply, with Wall Street's main indexes hitting record highs, after US drugmaker Pfizer and its German partner BioNTech said data from a large-scale trial of their vaccine showed it was more than 90 per cent effective in preventing Covid-19.
"Even with widespread distribution still months away the announcement effect will provide a consumer and business sentiment boost to be sure," RBC Capital Markets analysts said in a note.
"Whether people want to call that a 'V' recovery or not is, at this point, inconsequential - it is materially faster than most anyone appreciated," they said.
Travel firms Flight Centre Travel Group, Sydney Airport Holdings and Qantas Airways soared more than 10 per cent each on the news.
Energy stocks, which have been among the worst affected by the coronavirus-related hit to demand, climbed over 8 per cent as crude prices surged.
Australia's top independent gas producer Woodside Petroleum gained 8 per cent while Papua New Guinea-focused Oil Search surged 21 per cent.
Real estate firms Scentre Group, GPT Group and Dexus gained between 8 per cent and 15 per cent.
Gold stocks, however, slumped more than 7 per cent in their worst session since May 27, following a steep fall in bullion prices.
Miners Saracen Mineral Holdings, Northern Star Resources and Evolution Mining were among the top percentage losers on the benchmark.
Tech shares fell 4 per cent, dragged lower by a 6 per cent decline in buy-now-pay-later heavyweight Afterpay, which has soared so far this year due to increased online payment transactions during the pandemic.
Glove maker Ansell, which had benefited from a steep hike in demand this year, was on track for its worst day since March 31.
In New Zealand, the benchmark S&P/NZX 50 index rose as much as 2.2 per cent to hit a fresh peak.
Vista Group International, which develops software for the film industry, soared 20 per cent, while carrier Air New Zealand jumped 15 per cent.