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Australia: Shares rise on Trump tariff move, higher iron ore prices

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The S&P/ASX 200 index closed 0.4 per cent higher, rising 27.4 points to 6,595.9. On Tuesday, the benchmark fell 0.3 per cent, snapping a four-day winning streak.

[SYDNEY] Australian shares climbed to a one-week high on Wednesday, first due to President Donald Trump's delay of tariffs on some Chinese imports and then firmer iron ore prices that lifted mining stocks even further.

The US announcement overshadowed unexpectedly weak July data from China that pointed to a further loss of economic momentum.

The S&P/ASX 200 index closed 0.4 per cent higher, rising 27.4 points to 6,595.9. On Tuesday, the benchmark fell 0.3 per cent, snapping a four-day winning streak.

Biotech giant CSL Ltd provided some of Wednesday's gains, after the index heavyweight reported a record profit that raised its shares 6.6 per cent to an all-time high of A$234.0 (S$219.7).

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Market voices on:

Some analysts hope Mr Trump's selective three-month delay of tariffs will dial down US-China friction, but most investors don't believe tensions will subside for long. A Morgan Stanley note on the decision said "extra time & talks are modest positives but don't change the structural incentives for tensions."

Shares of iron ore miners, who have recently come under pressure from softer prices for the steelmaking material, jumped on Wednesday as futures edged higher.

The biggest gainer was Fortescue Metals Group, which closed 4.7 per cent higher. Mining giants BHP Group and Rio Tinto also climbed.

Goldman Sachs, in a note earlier this week, said the iron ore market was still tight and prices will have to rise.

Australian miners are particularly exposed to the Sino-US trade war as China is Australia's largest trading partner.

In New Zealand, the benchmark S&P/NZX 50 index edged 0.1 per cent lower to 10,849.76.

REUTERS