August 24, 2018 / 3:23 AM / 3 months ago

Australian shares gain after leadership vote ends political uncertainty, NZ higher

* Healthcare index hits record high

* Gold index hits over 9 month low

By Sumeet Gaikwad

Aug 24 (Reuters) - Australian shares rose on Friday, reversing earlier losses after a new leader was voted in by lawmakers from the country’s Liberal party, ending a political crisis that knocked investor confidence this week.

Treasurer Scott Morrison will become prime minister after winning a three-way battle for the leadership of the Liberal party on Friday, with incumbent Malcolm Turnbull not contesting the party ballot.

The S&P/ASX 200 index was up 0.3 percent, or 18.9 points to 6,263 by 0319GMT. The benchmark snapped a three session losing streak.

The index was also supported by the Australian healthcare sector, which hit a record high in early trade with CSL Ltd rising 1.9 percent, while Mayne Pharma Group hit its highest in nearly 1-1/2-years.

“Any of these companies with strong offshore earnings clearly benefit from the softening Australian dollar. The momentum is all for the downside,” said James McGlew, executive director of corporate stockbroking at Argonaut.

The Australian dollar was flat to higher on Friday, having fallen 1.7 percent over the previous two sessions.

Financial stocks, the country’s largest sector, were flat.

Two of Australia’s “big four” banks traded in the red, with the second biggest lender, Westpac Banking Corp, the biggest drag, down more than 2 percent. Westpac on Friday reported lower net interest margins for the third quarter amid higher funding costs.

“I think that one of the things we are looking for in our banks is their forecast levels of impairment from bad debts in particular,” McGlew added.

Consumer cyclicals lent support to the benchmark with Wesfarmers and Aristocrat Leisure rising 1.8 percent and 1.4 percent, respectively.

Commodity markets were lower as the U.S.-China trade dispute escalated after the world’s two largest economies implemented punitive 25 percent tariffs on $16 billion worth of each other’s goods.

The county’s mining index fell 0.3 percent on weak commodity prices amid global trade worries. Miners Rio Tinto was off 0.4 percent while Newcrest Mining fell over 3 percent.

Copper, Shanghai rebar steel futures and gold fell on Thursday as the U.S.-China trade dispute weighed along-with a strengthened dollar on expectations of hike in U.S. interest rates soon.

Across the Tasman sea, New Zealand’s benchmark S&P/NZX 50 index rose 0.2 percent or 17.02 points to 9,156.89.

Industrials and healthcare stocks helped the index crawl higher with Port of Tauranga adding over 3.4 percent, while Fisher & Paykel Healthcare Corporation gained 0.6 percent.

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Reporting by Sumeet Gaikwad in Bengaluru; Additional reporting by Nikhil Nainan; Editing by Sam Holmes

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