Australia: Upbeat virus treatment view, oil jump lift shares

[BENGALURU] Australian shares gained on Thursday as risk appetite improved after encouraging trial results of an experimental Covid-19 treatment, a rally in crude oil prices and assurances of support from the US Federal Reserve to help the battered economy.

The S&P/ASX 200 index rose 1.1 per cent to 5,451.5 by 0015 GMT. In New Zealand, the main S&P/NZX 50 bourse was roughly flat.

A top US health official said Gilead Sciences Inc's antiviral drug remdesivir was likely to become the standard of care for Covid-19 after early results from a trial showed it helped certain patients recover more quickly.

Investor sentiment was further bolstered after Fed chair Jerome Powell said the central bank would continue to support recovery from the economic shock of the coronavirus, after leaving key interest rates near zero.

Mr Powell's remarks followed additional stimulus measures from the Bank of Japan earlier this week. The European Central Bank is due to meet later in the day.

Overnight, the US Dow Jones Industrial Average rose 2.2 per cent, the S&P 500 gained 2.7 per cent and Nasdaq advanced 3.6 per cent.

GET BT IN YOUR INBOX DAILY

Start and end each day with the latest news stories and analyses delivered straight to your inbox.

Sign UpVIEW ALL

All but one sub-indexes on the Australian benchmark index traded higher and energy stocks were the best performers with a 4.4 per cent surge.

Brent crude futures rose 3 per cent to US$23.22 a barrel, while US West Texas Intermediate (WTI) crude gained 5.6 per cent to US$15.91 per barrel after US crude stockpiles grew less than expected, a welcome update in the face of a supply glut.

Single-stock moves saw Fortescue Metals add 5 per cent and hit a more than three-month high after the miner reported higher third-quarter iron ore shipments and hiked its annual shipments forecast.

The number of issues on the ASX that advanced were 832 while 227 declined as a 3.7-to-1 ratio favoured advancers. There were 91 new highs and 86 new lows. (Reporting by Shashwat Awasthi in Bengaluru; Editing by Subhranshu Sahu)

REUTERS