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Australia shares rise as oil rebound stirs risk appetite; Lynas soars

Published 23/04/2020, 11:06 am
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* Lynas on course for its best day in more than a year

* All major sectors on Australian benchmark index up

* Analysts warn relief in equity mkts could be temporary

By Shashwat Awasthi

April 23 (Reuters) - Australian shares rose on Thursday as risk appetite was whetted by a rebound in oil prices and hopes that global central banks would unleash more stimulus to cushion the economic blow from the coronavirus pandemic.

A 21% surge in rare earths miner Lynas LYC.AX also supported the benchmark S&P/ASX 200 index .AXJO , which advanced 1% to 5,274.7 by 0020 GMT.

All major sub-indexes traded higher, and energy stocks .AXEJ once again stood out with a 3% gain.

Lynas, the world's largest rare earths miner outside China, was poised for its best day since March 2019, after the company said on Wednesday the U.S. military would give it initial funding for a heavy rare earths separation facility in Texas.

Santos STO.AX jumped 6% as the country's second-largest independent gas producer benefited from higher crude prices and said it had sufficient liquidity and debt headroom to weather the recent plunge in prices. prices surged on the back of tentative talk of additional supply cuts from major global producers, after historic losses earlier this week. O/R

In the United States, Congress is set to pass a nearly $500 billion coronavirus aid bill on Thursday with even more relief measures expected to follow, as the country works on a three-stage reopening of its economy. along with new relief packages from the likes of Mexico, has raised hopes that other central banks will loosen their purse strings further to weather the virus-induced storm that has thrust the global economy towards an imminent recession.

But analysts warned the relief in equity markets might be short-lived.

"The Fed and other central banks can lean in and help but they don't have unlimited resources," ANZ Research said. "We remain guarded about the outlook and question the sustainability of the recent bounce in sentiment, which may not last."

S&P Global Ratings cautioned that credit conditions in the Asia-Pacific region would be "very tough" going into the second half of 2020 and that long-term recovery remained uncertain due to damage from the outbreak.

Ramsay Health Care RHC.AX , whose shares resumed trading after a voluntary halt, underperformed the market with a 4.5% drop following a discounted share placement.

New Zealand's main bourse S&P/NZX 50 .NZ50 rose 1.7% to 10,593.8, after three straight sessions of losses.

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