March 3, 2020 / 1:11 AM / a month ago

Australian shares rebound 2% on RBA rate-cut hopes; NZ jumps

* ASX 200 rises after seven straight sessions of losses

* RBA likely to trim rates by 25 bps later in the day

* NZ shares mark best intraday gain since August 2011

By Niyati Shetty

March 3 (Reuters) - Australian shares rose 2% on Tuesday after seven straight sessions of declines, as investors priced in a possible rate cut by the central bank to help cushion an economic blow from the coronavirus outbreak.

The S&P/ASX 200 index was up 1.9%, or 122.9 points, at 6,514.4 by 0100 GMT, after shedding 10.8% in the last seven sessions - its longest losing streak since September 2018.

The Reserve Bank of Australia is expected to cut its cash rate to a new low of 0.5% from 0.75% at its monthly review later in the day, as investors pinned hopes on a coordinated global monetary policy response after last week’s stock market plunge.

Fears of a pandemic rattled markets last week, wiping more than $5 trillion from global share values, and stoking widespread expectations of monetary policy easing.

Australian financial futures are now almost fully pricing in a quarter point cut to the cash rate. Last week, futures implied a one-in-five chance of such a move.

“Given Australia’s current moderate growth environment, limited room for monetary easing and the COVID-19 impact on supply chains and demand, we think it is necessary for fiscal policy to also support growth,” Cherelle Murphy, a senior economist at ANZ Research, said in a note.

Financials gained 1.5%, with the “Big Four” banks trading in positive territory. Westpac Banking Corp and National Australia Bank rose about 2% each.

The tech sector jumped nearly 5%, its best intraday gain in 18 months, tracking Wall Street peers.

Software maker Xero Ltd added 7.4% and buy-now-pay-later firm Afterpay Ltd surged 8.3%.

Healthcare firms climbed as much as 3.4%, their biggest in six months. Drugmaker CSL Ltd added 3.3%, while U.S.-based Resmed Inc gained 6.3%.

Meanwhile, global miner BHP Group added up to 3.4%, Rio Tinto Ltd advanced 4.7% and Fortescue Metals Group climbed 5.5%, supported by substantial gains in iron ore prices on Monday.

Across the Tasman Sea, New Zealand’s benchmark S&P/NZX 50 index jumped as much as 3.7% in its best intraday gain since August 2011.

The bourse was up 3%, or 334.87 points, at 11,439.97 by 0100 GMT.

Air New Zealand Ltd and Tourism Holdings Ltd were the best performers on the index, adding up to 10.1% and 7.9%, respectively. (Reporting by Niyati Shetty in Bengaluru; Editing by Subhranshu Sahu)

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below