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Australia shares rise on trade deal optimism; NZ markets gain

Published 05/12/2019, 12:23 pm
Updated 05/12/2019, 12:28 pm
© Reuters.  Australia shares rise on trade deal optimism; NZ markets gain
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* Financials gain despite RBNZ capital requirements decision

* Jump in oil prices lift energy stocks

* NZ benchmark up 0.5%

By Aby Jose Koilparambil

Dec 5 (Reuters) - Australian shares rebounded on Thursday, in line with Wall Street peers, after U.S. President Donald Trump eased investor concerns saying talks with China on the interim trade deal were going "very well".

The S&P/ASX 200 index .AXJO jumped almost 1% to 6,664.20 by 0025 GMT. The benchmark had declined about 3.7% over the past two sessions.

After roiling global markets earlier this week by raising the prospect of extended trade tensions between the world's top two economies, Trump said at a meeting of NATO leaders near London that "discussions are going very well and we'll see what happens". persists over the U.S. stance in relation to new tariffs on Chinese imports taking effect on Dec. 15, but investors tend to cheer any hint of positiveness on resolution to the trade dispute. The issue has marred markets for about one-and-a-half years and fuelled global growth concerns.

"This change of (Trump's) tone comes after China warned the U.S. that it would retaliate if the U.S. takes a tougher stance on how China treats its Muslim Uighur community,' said ANZ Research analysts in a note.

After sustaining two bruising sessions, all major sector-based sub-indexes on the benchmark rose, with the high-profile financial .AXFJ and mining .AXMM stocks advancing more than a percent each.

Three of the "Big Four" lenders gained between 1% and 1.6% despite New Zealand central bank announcing it would go ahead with plans to increase capital ratio requirements for banks, a move that is expected to hurt the bottom line of top Australian lenders who dominate the domestic market there. No. 4 retail bank Australia and New Zealand Banking Group ANZ.AX continued to be on a trading halt, requested ahead of the New Zealand central bank statement.

In the mining space, diversified players and index heavyweights BHP Group BHP.AX and Rio Tinto (LON:RIO) Ltd RIO.AX gained up to 1.7% and 1.3%, respectively.

The advancements in the duo were also aided by extended gains in iron ore futures after data showed shipments from Brazil dropped last week. energy index .AXEJ also put on more than 1%, lifted by a more than 3% jump in oil prices on expectations that OPEC and allied producers would extend production curbs amid large drop in U.S. domestic crude stockpiles. Petroleum WPL.AX and Oil Search OSH.AX climbed about 2% and 1.5%, respectively.

However, the only energy firm to fall among benchmark constituents was Whitehaven Coal WHC.AX after the country's largest independent coal miner cut its full year 2020 managed run of mine coal production outlook. the Tasman Sea, New Zealand's benchmark S&P/NZX 50 index .NZ50 rose 0.5% to 11,266.17.

Investment holding firm Infratil Ltd IFT.NZ was the top percentage gainer on the New Zealand benchmark, gaining more than 2% after its unit Tilt Renewables TLT.NZ said it would sell its Snowtown 2 Wind Farm for A$472 million ($320.30 million).

Tilt rose up to about 9% to hit a record high on the news.

($1 = 1.4736 Australian dollars)

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