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Australian and New Zealand join global rally on strong US job report

Published 11/07/2016, 12:48 pm
Updated 11/07/2016, 12:50 pm
© Reuters.  Australian and New Zealand join global rally on strong US job report
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SYDNEY/WELLINGTON, July 11 (Reuters) - Australian shares leapt on Monday, gaining 1.7 percent by lunchtime, while New Zealand stocks also tracked global markets higher, boosted by a much-larger-than-expected jump in U.S. job growth.

The S&P/ASX 200 index .AXJO added 91.06 points to 5,321.6 by 0206 GMT. The rally follows solid gains on Wall Street on Friday, when the benchmark S&P 500 SPXT touched all-time highs after the job report. sectors posted gains, as Australian shares tracked back towards their pre-Brexit high of 5,325.4 points.

"The bulls have been proactive this morning, particularly within materials and energy after overnight commodity strength," said Gary Huxtable, client adviser at broker and advisory firm Atlantic Pacific Securities.

"We're also seeing some bargain hunters re-emerging in the recently beaten up financial stocks, particularly those with U.K. exposure," he said.

"Investors seem to look at these stocks as too cheap to pass up, as opposed to the risks that these sectors face moving forward."

Following firming commodity prices in London on Friday, Australia's resource sector shares posted significant gains, with mineral sands explorer Iluka Resources Ltd ILU.AX surging 9.6 percent and mineral explorer Independence Group NL IGO.AX rising 8.47 percent on announcing gold, zinc and copper production within or above guidance.

Malaysia-based gold and mineral miner Saracen Mineral Holdings Ltd SAR.AX gained 5.7 percent. Copper miner Oz Minerals Ltd OZL.AX added 5.2 percent.

Whitehaven Coal Ltd WHC.AX rose 6.46 percent on rising coal prices and construction company CIMIC Group CIM.AX , formerly Leighton Holdings, gained as much as 3.2 percent on being awarded an A$1.58 billion tunnel project in Hong Kong.

Financial stocks also posted gains, with Australia's big four banks all jumping more than 2 percent. The strongest movers were Australia and New Zealand Banking Group ANZ.AX , which gained 3 percent and Westpac Banking Corp, which WBC.AX gained 2.69 percent.

New Zealand's benchmark S&P/NZX 50 index .NZ50 rose 0.7 percent or 48.17 points to 7,048.27.

The biggest gainer was New Zealand Refining NZR.NZ , which rose 2.55 percent.

Health care was the best performing sector, with software company Orion Health Group OHE.NZ up 2.54 percent and health appliance maker Fisher & Paykel Healthcare FPH.NZ rising 1.4 percent.

The subsidiaries of Australian banks also rose, with ANZ ANZ.NZ up 2.59 percent and Westpac WBC.NZ up 2.58 percent.

Rubber goods company Skellerup SKL.NZ led losses, falling 0.8 percent.

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