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Financials

Australia shares climb as strong GDP growth cements recovery hopes

* Q4 GDP growth 3.1% vs 2.5% rise forecast

* Mining, gold stocks climb over 3% each

* Tech stocks track losses in U.S. peers (Updates to close)

March 3 (Reuters) - Australian shares climbed on Wednesday after a much faster-than-expected economic growth in the final quarter of 2020 cemented hopes of a stronger recovery this year.

The S&P/ASX 200 index closed 0.8% higher at 6,818, after data showed the economy accelerated 3.1% in the December quarter, higher than forecasts for a 2.5% rise.

A very low community transmission of COVID-19, coupled with massive and timely fiscal and monetary stimulus, has led to a strong rebound in the economy.

“The big picture is that while the initial recovery through the first half of 2021 may still be subject to air-pockets and jobs vulnerabilities linger... Australia is unambiguously on a surer path to sustained recovery,” Mizuho analysts said in a note.

Reflation boost to commodities adds to tailwinds for the country’s growth prospects, they added.

Mining and gold stocks rebounded sharply, both gaining more than 3% on the back of an uptick in bullion, iron ore and copper prices.

Heavyweights BHP Group and Rio Tinto climbed 3.5% and 2.4%, respectively, while Ramelius Resources jumped nearly 14% to lead gains on the benchmark.

Rio said its chairman and a board director would step down, bowing to investor pressure over the destruction of two ancient Aboriginal rock shelters for an iron ore mine last year in Western Australia.

Financials ticked up 1.2%, hitting their highest in nearly a year, with the “Big Four” banks settling 1% to 2.5% higher.

Tech stocks fell 2.4%, tracking losses in U.S. peers overnight. Afterpay shed more than 2%, while software firm Xero Ltd declined 3.3%.

New Zealand’s benchmark S&P/NZX 50 index gained 0.1% to 12,359.26.

Reporting by Shruti Sonal in Bengaluru; Editing by Subhranshu Sahu

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