December 7, 2012 / 6:11 AM / 5 years ago

Australia shares hit 7-week high in broad rally, miners strong

(Updates with details, comments)
    Dec 7 (Reuters) - Australian shares rose 0.9 percent on
Friday to reach a seven-week closing high, with top miners
supported by rebounding iron ore prices and the broader market
up ahead of China's industrial production data over the weekend.
    China's new leaders were likely to stick with the 2012
growth target of 7.5 percent when charting a course for next
    "One of the reasons for the gains is better news we've seen
from China and expectations the economy there has stabilised and
growth has improved modestly," said Michael McCarthy, chief
market strategist at CMC Markets.
    Top global miner BHP Billiton Ltd climbed 1 percent
and rival Rio Tinto Ltd edged up 0.4 percent. 
    The benchmark S&P/ASX 200 index gained 42.5 points
to 4,551.8, according to the latest data. It slipped 0.3 percent
on Thursday.
    "That reflects very positive sentiments and confidence,"
said Michael Heffernan, an economist at Lonsec. "Europe is
becoming a less and less worrisome issue, and the American issue
looks like it's going to be sorted out one way or another."
    Investors are also becoming more confident now that a series
of Australian economic data this week is out of the way, said
    "I wonder with a number of national data hurdles cleared, if
those investors who've been buying dividend returns are back in
the market today," he said.
    Australia's gross domestic product rose 0.5 percent in the
third quarter, roughly in line with forecasts though the
smallest rise since early 2011, while employment data beat
expectations for a second month in November, with the jobless
rate surprising everyone with a drop to 5.2
    Meanwhile, the Australian market took a positive lead from
Europe, said Chris Weston, an institutional dealer at IG
Markets, after the European Central Bank (ECB) discussed
negative deposit rates at its meeting on
    "The big move overnight was that the ECB is considering
negative deposit rates, which could be really quite good for
other assets as well," Weston said.
    The major banks all advanced, led by a 1.1 percent rise in
Westpac Banking Corp. The nation's biggest lender,
Commonwealth Bank of Australia, rose almost 0.9
    Retailers rose ahead of the Christmas season, led by
department store David Jones Ltd, which climbed 2.0
percent. Wesfarmers Ltd, owner of supermarket chain
Coles, ended 1.0 percent higher. 
    But Myer Holdings Ltd backed off from earlier gains
and lost 0.5 percent, after saying at its annual general meeting
that a challenging retail and economic environment is continuing
both in Australia and internationally.
    Among defensive stocks, blood products maker CSL Ltd
 jumped 2.5 percent and telecommunications company
Telstra Corp Ltd added 0.2 percent.
    New Zealand's benchmark NZX 50 index rose 0.5
percent to 4,041.5 at the close.  

 (Reporting By Maggie Lu Yueyang; Editing by Jacqueline Wong)
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