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Australia, NZ shares climb as U.S. announces plan to reopen

Published 17/04/2020, 11:21 am
© Reuters.

* NZ stock index poised for best week ever

* Rio Tinto (LON:RIO) gains after Q1 production report

* China first-quarter GDP data in focus

By Shashwat Awasthi

April 17 (Reuters) - Australia and New Zealand stocks rose to their highest levels in more than a month on Friday as new guidelines allowing for a reopening of the U.S. economy supported risk sentiment and eased some concerns over the fallout from the coronavirus outbreak.

The Aussie S&P/ASX 200 index .AXJO climbed 1.9% to 5,518 by 0037 GMT, its highest since March 12.

New Zealand's benchmark S&P/NZX 50 index .NZ50 gained 2.4% to 10,725.2, rising for a fourth straight session. The bourse was on course for its biggest weekly gain ever.

Dealers are lapping up details of U.S. President Donald Trump's plans to revive the economy and planemaker Boeing (NYSE:BA) restarting some operations next week, said Stephen Innes, chief global markets strategist at AxiCorp. report that severe COVID-19 patients were positively responding to an experimental treatment of U.S. drugmaker Gilead GILD.O also boosted risk sentiment, though the company played down the report. is providing a more than suitable lead-in for what could be sobering assessment when China GDP gets delivered later this morning," Innes said.

A Reuters poll showed the coronavirus pandemic likely knocked China's economy into its first decline since at least 1992 in the first quarter. data is "expected to be ugly, capturing the enormous outbreak-related disruption seen over the quarter," analysts at ANZ Research said.

Away from macro-economic developments, shares of Rio Tinto RIO.AX advanced 3% after the world's largest iron ore miner reported higher first-quarter shipments and said demand in China continued to recover. Coca-Cola (NYSE:KO) Amatil CCL.AX underperformed with a 3% fall after the soft drinks bottler withdrew its dividend payout forecast.

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Market participants also took heart from a drop in weekly U.S. jobless claims, even as a record 22 million Americans sought unemployment benefits in the last month. unemployment stateside is likely to strike a chord in Australia, where economists warn the full scale of job losses amid virus-induced shutdowns will become apparent in the coming months and the economy looks poised for its first recession in three decades.

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