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Australia shares up on China data, Wall Street gains; NZ falls

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Australian shares rose on Monday, starting the June quarter on a positive note as strong Chinese data bolstered miners and gains on Wall Street lifted broader investor sentiment.

[BENGALURU] Australian shares rose on Monday, starting the June quarter on a positive note as strong Chinese data bolstered miners and gains on Wall Street lifted broader investor sentiment.

The S&P/ASX 200 index rose 0.7 per cent to 6,226.20, more than a one-week high, by 0001 GMT. The benchmark had risen 0.1 per cent on Friday and added 0.7 per cent in the March quarter.

An official survey on Sunday showed factory activity in China, Australia's biggest trade partner, unexpectedly grew for the first time in four months in March.

Wall Street rose on Friday amid signs of progress in US-China trade talks. Beijing said it would continue to suspend additional tariffs on US vehicles and auto parts after April 1 in a goodwill gesture after Washington delayed tariff hikes on Chinese imports.

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A delegation led by Vice-Premier Liu He will be in Washington this week for another round of talks.

"Positive news and trading on Friday night along with the release of stronger-than-expected data from China is helping the local sentiment. The manufacturing outlook in China has lifted commodity prices," said Michael McCarthy, chief market strategist at CMC Markets.

Australia's metals and mining sub-index rose about 1 per cent and was on track to post a fifth straight session of gains, with sector giants BHP Group and Rio Tinto firming 1.3 per cent each, while Fortescue Metals Group added 4.4 per cent.

Chinese iron ore futures rose sharply on Friday after Vale SA slashed its 2019 sales estimate and Rio Tinto declared force majeure on some contracts after tropical cyclone Veronica.

Financials supported the broader sentiment, adding about 0.9 per cent. The Big Four banks advanced between 0.5 per cent and 1.1 per cent.

Shares in supermarket chain Woolworths Group rose as much as 2.8 per cent after the company said it would close 30 stores at BIG W, its loss-making discount department store chain, along with two distribution centres.

Gold stocks dropped up to 1.5 per cent as the higher risk appetite dented the appeal of the safe-haven metal.

Investors are looking ahead to Tuesday's Reserve Bank of Australia (RBA) policy meeting and the federal budget.

Although the RBA is expected to keep rates at 1.5 per cent on the back of a resilient labour market, predictions that the central bank will lower rates later this year have increased significantly.

The government's annual budget is expected to contain measures to boost the economy, including tax and spending sweeteners ahead of a federal election due by May 18.

Across the Tasman Sea, New Zealand's benchmark S&P/NZX 50 index fell up to 0.4 per cent to 9,804.

Restaurant Brands New Zealand was the top percentage loser on the benchmark, shedding 4 per cent.

REUTERS