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Australia shares touch highest in 6 weeks after oil surges; NZ firmer
October 11, 2016 / 12:52 AM / a year ago

Australia shares touch highest in 6 weeks after oil surges; NZ firmer

Oct 11 (Reuters) - Australian shares gained on Tuesday, bolstered by energy stocks, after oil prices jumped as much as 3 percent and Brent hit a one-year high.

The S&P/ASX 200 index rose as much as 0.4 percent to 5,498 points, the highest level since Aug. 30, before shedding some of the gains.

Oil prices surged after Russian President Vladimir Putin said Russia was ready to join a proposed deal to curb oil production in the hope of stemming a two-year price slide.

Putin, speaking at an energy congress in Istanbul, said that low oil prices have lead to under-investment in the global energy sector which will turn into a deficit at some point and trigger new “unpredictable jumps” in prices.

Saudi Energy Minister Khalid al-Falih said he was optimistic of a deal by November. His Algerian counterpart Nouredine Bouterfa said he expected to see “commitments” on cuts from non-OPEC oil producers at meetings in Istanbul this week.

“It was pretty much a certainty that the energy and materials were going to start on their front foot this morning, on the back of a good rise in oil prices as Saudis talked optimistically about production freezes,” said Tony Farnham, an economist with Patersons Securities.

Energy stocks gained 2.1 percent to touch a seven-week high. Oil major Santos Ltd jumped 4.8 percent and Oil Search Ltd rose 2.6 percent.

Sentiment was also aided by iron ore and steel futures in China, which rebounded from multi-week lows on Monday amid hopes that government efforts to curb property purchases may only have limited impact in cooling overall steel demand.

Global miner BHP Billiton extended gains into a fourth-straight session, advancing 1.6 percent while Rio Tinto was up as much as 1.4 percent, hitting a five-month high.

Retail giant Woolworths Ltd extended gains, rising nearly 1 percent.

Sirtex Medical Ltd fell as much as 6.2 percent, its biggest intra-day percentage loss in four months.

Advancing issues outnumbered decliners on the Australia Stock Exchange by a 1.45-to-1 ratio.

New Zealand’s benchmark S&P/NZX 50 index snapped five-straight sessions of losses to rise 0.5 percent or 32.74 points to 7,149.66.

Industrials and utilities accounted for nearly half of the benchmark’s gains.

Poultry processing services provider Tegel Group was the top percentage gainer, climbing 2.8 percent.

Auckland International Airport advanced 2.1 percent and Air New Zealand extended gains, rising 1.1 percent.

For more individual stocks activity click on (Reporting by Shashwat Pradhan; Additional reporting by Justin George Varghese in Bengaluru; Editing by Richard Borsuk)

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