July 18, 2018 / 6:43 AM / 3 months ago

Aussie shares cheered by BHP's record annual iron ore output; NZ down

* BHP hits near 9-mnth high on record output

* Energy and gold indexes extend losses (Updates to close)

By Nikhil Nainan

July 18 (Reuters) - Australian shares rose on Wednesday after global miner BHP reported record iron ore output for fiscal 2018, which sent its shares up over 3 percent in a boost to peers and overall sentiment.

Wall Street’s positive overnight lead also helped the S&P/ASX 200 index put on 0.7 percent to 6,245.1 at the close. The benchmark fell 0.6 percent on Tuesday.

The world’s biggest miner said its iron ore output rose 3 percent during the three months through June, topping forecasts, and set its fiscal 2019 production target slightly higher.

BHP’s shares rose 3.3 percent to a near 9-month high on the news, and pulled up the mining index 1.4 percent.

Even an expected $650 million charge to fiscal 2018 results to cover the failure of the Samarco Dam in Brazil did not dampen investor sentiment.

“Everyone knew there was a charge coming; that was probably towards the lower end of the worst-case scenario. I think the hit they have taken is at the lesser end of the scale,” said Christopher Conway, head of research and trading at Australian Stock Report.

Positive BHP sentiment cascaded to its peers, with Rio Tinto and South32 Ltd up 0.4 percent and 0.9 percent, respectively.

On the other hand, energy stocks extended their declines as oil prices dropped after an industry group reported that U.S. crude inventories rose last week, defying analyst expectations for a significant reduction.

The energy index, fell for a sixth straight session after closing 0.6 percent lower on Wednesday.

The gold index also fell for a fourth consecutive session, as gold prices hovered near one-year lows, after upbeat testimony to Congress from Federal Reserve Chairman Jerome Powell on the U.S. economy buoyed the U.S. dollar.

New Zealand’s benchmark S&P/NZX 50 index dropped 0.4 percent to finish at 8,946.1.

Health care stocks led the losses, while Z Energy was the biggest percentage loser, falling 2.7 percent after cutting its 2019 operating earnings forecast.

Reporting by Nikhil Kurian Nainan in Bengaluru Editing by Shri Navaratnam

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