October 28, 2019 / 12:44 AM / 24 days ago

Australia shares advance on trade progress; mining stocks lead

* U.S.-China trade-deal progress boosts sentiment

* Resource stocks rack up gains on firm oil and iron ore prices

* Sims Metal Management top loser, forecasts H1 loss

By Rashmi Ashok

Oct 28 (Reuters) - Australian shares notched gains on Monday, propelled by hopes that Washington and Beijing were close to finalising parts of a trade pact, while firm commodity prices gave an added fillip to resource stocks.

The U.S. Trade Representative’s office and China’s Commerce Ministry said officials of both nations are “close to finalising” some parts of a trade agreement after high-level telephone discussions on Friday, with talks set to continue.

U.S. President Donald Trump has said he hopes to sign the deal with China’s President Xi Jinping next month at a summit in Chile.

The trade news, along with robust earnings from Intel Corp boosted investor sentiment, driving the S&P 500 index to a near record high on Friday.

The S&P/ASX 200 index was up 0.3% or 20.40 points at 6,759.60, as of 0006 GMT, set for its sixth straight session of gains. The benchmark closed 0.7% firmer on Friday.

“A number of the risks that the market had been worried about are now dissipating,” said Christopher Conway, senior financial adviser at advisory firm Marcus Today.

“The U.S.-China trade talks are looking more positive, the Fed is also largely expected to cut interest rates this week and the RBA is also expected to cut before the year-end. The U.S. corporate earnings have also not been as bad as expected.”

Powering the benchmark, resource stocks notched up sharp gains to offset the lacklustre trade in financial stocks.

Miners jumped 1% after Chinese iron-ore futures advanced on signs that demand remains firm.

Mining behemoth BHP Group Ltd tacked on as much as 1.4%, while rival Rio Tinto Ltd rose 1.5%.

World’s No. 4 iron ore miner Fortescue Metals Group added 1.6%.

Energy stocks advanced as expectations of supply cuts by OPEC and falling U.S. inventories propped up oil prices across the last week.

Woodside Petroleum Ltd, the country’s largest oil and gas company, traded marginally higher, while smaller rival Santos Ltd rose nearly 1%.

Fuel refiner Viva Energy Group Ltd rose as much as 4.1% after posting a sharp increase in quarterly refining margins from the preceding quarter.

Robust quarterly results by Universal Coal PLC pushed the stock 4.6% higher, also driving up shares of other coal miners such as Whitehaven Coal and New Hope Corp .

Bucking the trend, metals and electronics recycler Sims Metal Management was the biggest loser in the index by a large margin, down 15.5% after forecasting an underlying core earnings loss for the first half due to weakness in scrap prices.

Meanwhile, New Zealand markets remained closed on account of Labour Day. (Reporting by Rashmi Ashok in Bengaluru, Editing by Sherry Jacob-Phillips)

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