Australian, NZ shares get boost from US-China trade talks

[BENGALURU] Australian shares opened higher on Monday in a shortened last trading session of the year, helped by signs of progress in trade talks between the United States and China.

The S&P/ASX 200 index gained 0.7 per cent, in thin volumes, to 5,693.1 by 0011 GMT, on track for its fourth straight session of gains though not enough to offset an 8.4 per cent loss in the final quarter of the year.

The benchmark has fallen just over 6 per cent so far this year, which will be the largest annual decline since 2011.

Over the weekend, US President Donald Trump said on Twitter that he had a "long and very good call" with Chinese President Xi Jinping and that a possible trade deal between the United States and China was progressing well, raising hopes for a breakthrough in a dispute that has lasted for much of 2018.

The market's broad gains were supported by a 0.8 per cent rise in financial stocks, a sector that has been under immense pressure this year over widespread revelations of misconduct that has hit some of the nation's largest financial institutions. The sub-index has tumbled over 14 per cent in 2018.

The country's "Big Four" lenders were up in a range between 1.1 per cent and 1.6 per cent.

Meanwhile, mining stocks were also up 1.1 per cent with top miners BHP Group and Rio Tinto climbing 1.7 per cent and 1.4 per cent, respectively.

Gold stocks, which have seen a near 10 jump this month on the back of an exceptionally disappointing end of the year for equities over concerns of slowing economic growth, have benefited from a flight to risk assets.

Newcrest Mining boosted the sub-index, rising 3.2 per cent.

New Zealand's benchmark S&P/NZX 50 index closed 0.3 per cent higher at 8,811.27. The country's benchmark gained about 5 per cent this year, in contrast to its neighbour.

Top constituents a2 Milk Company and Fletcher Building added 2 per cent and 1.4 per cent, respectively.

REUTERS