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Australia shares swept higher by U.S.-China trade truce, NZ up

Published 03/12/2018, 01:02 pm
Updated 03/12/2018, 01:10 pm
© Reuters.  Australia shares swept higher by U.S.-China trade truce, NZ up
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* Mining, energy units top benchmark's rise

* GrainCorp leads ASX gainers after buyout offer

* Banks propel NZ main board higher

By Devika Syamnath

Dec 3 (Reuters) - Australian stocks saw gains across the board on Monday, with risk sentiment rejuvenated by a stopgap truce between U.S. and China after months of tit-for-tat tariffs that stoked trade war concerns and put a damper on global growth.

The benchmark .AXJO rose by as much as 1.7 percent, notching its best intraday climb in over 9 months after three weeks of moping in the red. The main index was up 1.4 percent or 81.8 points at 1251 GMT.

"The temporary truce declared between China and the United States is positive for risk assets across the board," said Michael McCarthy, chief market strategist at CMC.

China, Australia's biggest trade partner, and the United States agreed to put a hold on new tariffs for 90 days.

China also agreed to buy agricultural, energy, industrial and other products from the United States in an attempt to redress the massive trade imbalance targeted by the Trump administration. .AXMM and energy stocks .AXEJ were the most sought-after on the main board, advancing as much as 3.1 percent and 3.6 percent, respectively.

Global mining heavyweights Rio Tinto (LON:RIO) RIO.AX and BHP Group BHP.AX added up to 2.5 percent and 3.5 percent, each. Bauxite miner South32 Ltd S32.AX rose as much as 6.5 percent.

News of a share buyback of up to A$$250 million pushed BlueScope Steel BSL.AX 11.1 percent higher. stocks .AXFJ were up about 0.9 percent higher at 0156 GMT, while the benchmark was up 1.6 percent.

The 'Big Four' banks rose between 0.2 and 1.1 percent after the high-profile Royal Commission inquiry into financial services misconduct wound up its hearings on Friday.

The Royal Commission exposed a litany of misconduct and wrongdoing at the country's top banks, with its recommendations due in February expected to "change the face of the financial markets in Australia", said McCarthy.

Shares of drought-hit bulk grain handler GrainCorp Ltd GNC.AX soared 34 percent after a A$2.38 billion ($1.75 billion) takeover offer from Long-Term Asset Partners Pty Ltd, (LTAP) described by local media as a new investment entity attempting its first acquisition.

The all-cash offer of A$10.42 a share was a near-43 percent premium to the stock's closing price on Friday. It was trading at A$9.25 at 0125 GMT. said this hesitance stems from the market's "high degree of doubt" regarding the deal's feasibility, considering how little was known about LTAP's financial backers and the buyer's plans for Graincorp .

Across the Tasman Sea, New Zealand's benchmark S&P/NZX 50 index .NZ50 was up 0.7 percent at 8,881.23 at 1242 GMT, boosted by financial stocks.

Financial services provider Heartland Group Holdings HGH.NZ added as much as 2 percent. ($1 = 1.3587 Australian dollars)

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