* Aussie shares rise as investors look past trade tensions
* Banks lead gains on the benchmark
* Materials and energy knocked by lower commodities and oil prices
* NZ falls on healthcare weakness
By Aditya Soni
July 12 (Reuters) - Australia's main stock index bounced back on Thursday, led by gains in bank and healthcare shares, but miners and oil producers fell on fears that a rapidly escalating U.S.-China trade dispute will slow global demand.
The S&P/ASX 200 index .AXJO rose 0.7 percent or 42.90 points to 6,258.50 by 0200 GMT.
The benchmark had dipped 0.8 percent on Wednesday, after Washington's threat to impose tariffs on a further $200 billion of Chinese imports rang alarm bells across financial markets.
China has accused the United States of bullying and warned it could hit back, although it was unclear how it would retaliate. news of extra tariffs dominated the global markets... and clearly our markets priced it in," said James McGlew, Executive director of corporate stockbroking at Argonaut.
Banks led the recovery in local stocks on Thursday, with the financial index .AXFJ jumping 0.8 percent.
Australia's banking watchdog on Wednesday said its intense crackdown on risky mortgage lending was largely complete, as higher lending rates were also helping cool the country's housing market. APRA comments put a bit of momentum back into a sector that's been well and truly beaten up through the process of the Royal Commission here," said McGlew.
Top lender Commonwealth Bank of Australia CBA.AX climbed 0.9 percent, while Westpac Banking Corp WBC.AX rose 1 percent, its biggest intraday percentage gain in nearly three-weeks.
Health care stocks also advanced, propping up the benchmark.
CSL Ltd CSL.AX , the country's fifth largest firm by market value, firmed 1.7 percent, while hearing aid maker Cochlear Ltd COH.AX strengthened 2.3 percent to a more than one-week high.
However, a slump in oil and commodities prices drove down energy and materials stock, capping the benchmark's rise.
Global benchmark Brent crude oil had its biggest one-day drop in two years on Wednesday, putting pressure on oil-focused firms. O/R
Woodside Petroleum Ltd WPL.AX dipped 1.5 percent, while Oil Search Ltd OSH.AX fell as much as 4 percent to a more than two-week low.
A plunge in base metal prices on Wednesday, lead by a three percent drop in London copper pushed materials stock, especially miners lower.
Index heavyweight BHP Ltd BHP.AX slipped 0.8 percent, while its spin off South32 Ltd S32.AX slid 1.1 percent.
Meanwhile, New Zealand shares edged lower, with the benchmark S&P/NZX 50 index .NZ50 slipping 0.1 percent or 4.78 points to 8,996.61.
Health care stocks underpinned the bearish trend, with Ryman Healthcare Ltd RYM.NZ and EBOS Group Ltd EBO.NZ dipping 0.9 percent and 0.6 percent, respectively.
Elsewhere, A2 Milk Company Ltd ATM.NZ reversed from losses earlier in the session to rise 0.3 percent.
The dairy product maker said annual revenue grew nearly 70 percent to around NZ$922 million ($622.26 million) and flagged higher costs going forward to ramp up its China business to compete in the dairy-hungry market. = 1.4817 New Zealand dollars)