Australia shares hit 3-week high on global economic optimism

Wed Jul 2, 2014 10:48pm EDT

Related Topics

* ASX 200 adds 0.7 pct to touch a 3-week high

* Gains broad-based, banks and miners lead

* Stronger global data support sentiment (Adds analysis, quotes, stocks on the move)

By Thuy Ong and Naomi Tajitsu

SYDNEY/WELLINGTON July 3 (Reuters) - Australian shares rose broadly to scale a 3-week peak on Thursday, steered by more signs of economic momentum in the United States, yet another record high on Wall Street and gains for metals prices.

After a soft month in June, institutional investors were also busy picking up bargains as a batch of data stoked renewed optimism about the health of the global economy.

"Investors do all the portfolio rebalancing in June to close up the financial year and the money they have left on the sidelines of the whole process, they generally put it into the market at lower levels," said Stan Shamu, market analyst at IG.

On Wednesday, the Dow and the S&P 500 closed at record highs, after figures from payrolls processor ADP added to a string of bullish U.S. data. The ADP data raised hopes the government's payrolls report due later Thursday would confirm a strong rebound in the U.S. economy after a first-quarter slump.

The S&P/ASX 200 index climbed 0.7 percent or 38.8 points, to 5,494.2, its highest mark since June 10, by 0243 GMT. The benchmark jumped 1.5 percent from 2-1/2 month lows on Wednesday, its biggest one-day percentage gain in two weeks

Blue-chip miners, BHP Billiton Ltd added 0.9 percent, and Rio Tinto Ltd gained 0.7 percent, supported by copper prices rising to its highest in more than four months after the strong U.S. data raised hopes of a pick up in demand.

The 'Big Four' banks continued their run higher as investors chased their high yields, with Westpac Banking Corp adding 1 percent and Commonwealth Bank of Australia climbing 0.5 percent.

CBA said on Thursday it will set up an independent review programme for customers of is financial planning division, a week after a Senate committee report accused it of covering up a misconduct that left thousands of its customers without their savings.

Weaker-than-expected Australian retail sales for May drew a mixed reaction from stocks in that space.

Takeover target David Jones Ltd declined 0.3 percent, although rival department store operator Myer Holdings Ltd managed to tack on 0.5 percent.

Meanwhile, Australia's competition regulator expressed concerns about two takeovers being pursued by South Africa's Woolworths Holdings Ltd's, arguing the deals might benefit billionaire retail investor Solomon Lew unfairly.

New Zealand's benchmark NZX-50 index edged up 4.6 points to 5,1536.85, led by a 2 percent rise in Diligent Board Member Services, after its stock sank to a six-month low of NZ$3.80 last week.

The NZX-50 has been supported near a lifetime high around 5,232 hit in April, but trading has been subdued as investors digest a series of IPOs, including corporate travel software developer Serko and utilities software developer Gentrack late last month. (Editing by Shri Navaratnam)

FILED UNDER: