Australia shares gain ground in broad rise as resources jump

Wed Jul 16, 2014 10:00pm EDT

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* ASX 200 adds 0.5 pct in broad rise

* A rise in metals prices props up mining stocks (Adds analysis, quotes, stocks on the move)

By Thuy Ong and Naomi Tajitsu

SYDNEY/WELLINGTON, July 17 (Reuters) - Australian shares added 0.5 percent on Thursday as Wall Street edged higher, while an uptick in metals prices helped support the mining space.

U.S. stocks rose on Wednesday with the Dow Jones industrial average closing at a record high, boosted by the latest merger news and some strong corporate earnings.

The broader market was propped up by a strong resource sector. Aluminium touched its highest in 16 months, while benchmark 62 percent grade iron ore for immediate delivery to China rose to $98.

Global miners BHP Biliton Ltd and Rio Tinto Ltd added 1.5 percent and 1.7 percent, respectively. Meanwhile, gold miners jumped higher with Newcrest Mining Ltd soaring 2.2 percent after bullion rebounded following two consecutive days of sharp losses.

"As the price of iron ore steadies, the major miners have acted as the driving force in our index with Chinese growth seemingly back," said Niall King, a sales trader at CMC Markets in a note.

The S&P/ASX 200 index rose 27.1 points to 5,546.0 by 0139 GMT. The benchmark added 0.1 percent on Wednesday.

On the benchmark index, 147 stocks traded higher, 37 lost ground while 16 remained unchanged.

Among top 20 stocks on the index, big banks Australia and New Zealand Banking Group and Commonwealth Bank of Australia gained 0.4 percent and 0.1 percent, respectively, while consumer retail staple Wesfarmers Ltd climbed 0.9 percent.

Woodside Petroleum Ltd rose 0.9 percent, helping to lift the oil sector, after reporting an 18 percent rise in second-quarter production. Santos Ltd was up 0.6 percent.

Mount Gibson Iron Ltd soared 5.1 percent after posting record full-year ore sales and revenue.

David Jones Ltd is in a trading halt pending an announcement of a second court hearing on the takeover by South Africa's Woolworths.

New Zealand's benchmark NZX-50 index slipped 6.5 points to 5,107.67, led by a 2 percent slide in power company Trustpower, as investors booked profits in the firm's jump to an 11-month high on Wednesday.

New Zealand shares have been mildly softer in the past few weeks as investors make room on their books for upcoming domestic IPOs.

Software company Vista Group International on Thursday announced that it would issue shares at NZ$2.35 per share in its offer to raise NZ$40 million ($34.82 million) in fresh capital ahead of its listing on the NZX Main Board and ASX on Aug. 11.

The pricing just below the midpoint of the indicative rate of NZ$2.10 and NZ$2.70 per share could suggest a slight cooling in demand for new shares in the current raft of IPOs following the sluggish performance of utilities software developer Gentrack and travel software developer Serko, which listed in June.

Other firms including glass maker Metro Performance Glass and Entertainment and agricultural company Scales Corporation are also planning to list, with more expected in the pipeline later in the year. (Editing by Jacqueline Wong)

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