(Adds analysis, quotes, stocks on the move)
SYDNEY, Aug 12 (Reuters) - Australian shares rose 0.4 percent on Monday after a rise in metals prices helped the materials sector, while some better-than-expected earnings bolstered investor sentiment.
The materials sector lifted the market after copper rose to its highest in two months on upbeat Chinese factory data and gold climbed 1 percent on soft U.S. data. BHP Billiton Ltd and Rio Tinto Ltd climbed 2.5 percent and 2.7 percent respectively.
Gold miner Newcrest Mining Ltd rallied 4.4 percent on rising gold prices, but gains were capped as the world’s fifth largest gold producer reported its first annual loss since 2002 on Monday, hit by A$6.2 billion in writedowns it flagged in June after gold prices plunged. Rival gold miner Regis Resources Ltd added 3.5 percent.
The S&P/ASX 200 index had risen 19.1 points to 5,074.3 by 0148 GMT. The benchmark fell 1.2 percent last week, its biggest weekly drop in two months.
Electronics and entertainment retailer JB Hi-Fi Ltd climbed 2.6 percent to A$19.00, its highest point since May 2011, after it posted a better-than-expected 11 percent rise in its 2013 full-year profit on Monday, its first annual profit growth since 2010.
Analysts said earnings from major companies have been relatively close to expectations so far, but the market will continue to monitor reports over the next three weeks for clues to domestic economic growth.
“The expectation is for a better-than-expected reporting season, particularly from the domestic industrials sector, which has been very weak for the past five halves,” said Martin Lakos, division director at Macquarie Bank.
“But this half we expect earnings greater of around 5 percent in the industrials. That’s a turnaround, we think, in the earnings cycle, driven by management cutting costs and improving balance sheets - we do think the market can go higher.”
Among industrials, James Hardie Industries rose 1.7 percent after the building materials maker reported a 19 percent rise in first quarter net operating profit on Monday, excluding asbestos liabilities, bolstered by higher sales volumes and prices.
The market has bounced back from a trough of 4,632.3 points hit on June 25, but worries about slowing growth in China and uncertainty about the U.S. Federal Reserve’s stimulus programme have seen the index pull back from the 5,100 level reached in early August.
Elsewhere, Australian engineering company UGL Ltd added 1.4 percent after the company said on Monday that it will split its engineering and property businesses after reporting a 73 percent fall in annual profit.
Meanwhile, Bandanna Energy Ltd soared 11.4 percent to hit an intraday 5-month high of A$0.20 after the company reported its Springsure Creek coal project’s measured resources had increased by 35 percent to 74 million tons.
Coffey International jumped 20 percent to A$0.18, a near 3-month high, after the professional services consultancy reduced fixed costs in its various operations, trimming significant losses to a net loss after tax of $1 million compared to a loss of $34.5 million the previous year.
New Zealand’s benchmark NZX 50 index fell 0.5 percent to trade at 4,512.3 points.
Reporting by Thuy Ong; Editing by Eric Meijer