* Big dividend stocks gain on hopes of policy easing
* BHP, Rio among top contributors to ASX
* GrainCorp rises on deal with Aon (NYSE:AON) PLC
By Devika Syamnath
June 7 (Reuters) - Australian shares advanced for the fourth session on Friday as this week's domestic rate cut and expectations global central banks will open the money spigot underpinned sentiment, boosting cyclicals and firms offering strong dividend yields.
While a worsening Sino-U.S. trade war has shaken confidence in financial markets, riskier assets have been given a boost on signs policy makers are prepared to ease monetary conditions to support growth.
"The stimulus for the market, as is the case with the U.S. markets, has been the easing of interest rates in Australia that makes all the yield players looks relatively more attractive," said James McGlew, Executive director of corporate stockbroking at Argonaut.
Stocks with attractive dividend payouts such as the big miners and banks led gains on Australia's S&P/ASX 200 index, .AXJO which rose 0.5% at 6,415 by 0224 GMT, having gained 0.4% on Thursday.
The Reserve Bank of Australia cut rates to a record low on Tuesday and signalled willingness to go further as the Sino-U.S trade war raises global recession risks. The same risks have prompted traders to wager the U.S. Federal Reserve will cut rates before year-end. we have seen overseas, particularly in the U.S. market over the last 7 days or so is that reactions to the trade issues ... have taken a backseat to the very fundamental things, which is the increased chances of availability of easy money with further easing in rates," McGlew said.
Investors are waiting on a key U.S. jobs report later in the day for further clues on interest rates there. MKTS/GLOB
Australia's mining stocks .AXMM posted strong gains led by majors BHP Group BHP.AX and Rio Tinto (LON:RIO) RIO.AX rising as much as 2% and 1.5%, respectively.
BHP, the world's biggest miner, said it has set up a taskforce to further improve internal dam management and boost safety, months after a second deadly dam disaster in Brazil crimped output and sent iron ore prices soaring. stocks .AXEJ rose thanks to extended rally in global oil prices on reports that Washington could postpone trade tariffs on Mexico and signs OPEC and other producers may extend crude supply cuts. O/R
The sub-index notched jumped as much as 1.5%, while oil and gas units such as Santos Ltd STO.AX and Woodside Petroleum WPL.AX each rose 2.1%.
Bank stocks .AXFJ hit their highest in two weeks with the "big four" gaining between 0.4% and 0.6%.
Elsewhere, GrainCorp GNC.AX , Australia's biggest listed bulk grain handler, said it has signed a 10-year deal with a unit of Aon PLC AON.N to reduce cash flow volatility linked to eastern Australian grain production, especially during droughts. shares surged 4.9% on the news.
New Zealand's benchmark S&P/NZX 50 index .NZ50 was 0.3% higher at 10,012.84.
Synlait Milk Ltd SML.NZ rose 2.9% and was the top gainer on the benchmark.