MELBOURNE Jan 3 Australian shares rose 0.7
percent to reach their highest close in more than 19 months on
Thursday as investors snapped up exporters such as miners on
encouraging news from the world's two biggest economies.
Data showing growth in China's services sector accelerated
at its fastest pace in four months reinforced the spike in world
stocks and commodity prices which followed news that the U.S.
avoided a "fiscal cliff" budget crunch..
Miners gained, with iron ore producer Fortescue Metals
rising 2.4 percent to A$5.04, its best close in six
"Investors have embraced companies or industry sectors that
are more dependent on economic growth like retailers, miners and
energy producers," said Craig James, economist at broker
"A stronger global economy means increased demand for raw
materials, potentially lifting raw material prices," he said.
The benchmark S&P/ASX 200 index rose 35 points to
4,740.7, according to the latest data, its highest since May 19,
2011. Wednesday's 1.2 percent gain was the biggest one-day rise
in five months.
New Zealand's benchmark NZX 50 index rose 0.4
percent to 4,082.4 as trade resumed on Thursday after holidays.
BHP Billiton added 0.8 percent to A$38.15, while
Rio Tinto notched up 2.4 percent to A$69.25.
Both miners were at their strongest since February on higher
iron ore prices and relief over the U.S. budget agreement.
"Universally this has been regarded as a good thing, with
investors scrambling to get back into risky financial assets
like shares and commodities in preference to safe-haven assets
like bonds," said James. "Hopefully, now confidence can
Mirabela Nickel Ltd rallied 8.6 percent to A$0.57
after Moody's Investors Service lifted its outlook to stable
from negative, saying the change reflected Mirabela's improved
liquidity. The stock had traded below A$0.30 last year.
Insurance Australia Group Ltd rose 0.6 percent to
A$4.72 after it said its 2013 group catastrophe reinsurance
programme provides protection of up to A$5 billion, compared to
A$4.7 billion in 2012.
Department store Myer ended unchanged at A$2.21. A
spokesman said the company continued to expect flat sales for
Christmas and January from a year earlier.
"We have been saying that Christmas and stocktake (sales)
combined will be flat and we maintain that view," the spokesman
(Reporting by Miranda Maxwell; Editing by Richard Borsuk)