* Benchmark hovers just shy of 6,400 resistance mark
* Miners skyrocket as iron ore futures hit record high
* Mining sub-index set for weekly gain of 5%
* Financials set for over 3% weekly fall
By Rashmi Ashok
May 17 (Reuters) - Australia’s benchmark share index rallied to a more than 11-year high on Friday as soaring iron ore and oil prices coupled with a weaker local dollar bolstered mining and energy stocks.
Growing expectations that the central bank could cut interest rates as soon as next month also continued to buoy investors’ confidence.
The S&P/ASX 200 index was up 48.50 points or 0.8% at 6,376.30 by 0125 GMT, after climbing 1.1% earlier. The benchmark closed 0.7% higher on Thursday.
“The action is being led by a very strong performance on base metals overnight. The odds of another interest rate cut after the election are also high, which makes high yielding stocks very attractive,” said James McGlew, Executive director of corporate stockbroking at Argonaut.
“The lead overnight was positive and the Australian dollar continues its fall because of the perceived interest rate cut,” he said, explaining that export-focused commodity stocks found an additional boost because of the local dollar weakness.
Miners jumped 1.2%, a day after Chinese iron ore futures hit a record high, boosted by robust demand for the steelmaking material amid tight supply.
BHP Group rose as much as 1.9% and rival Rio Tinto advanced 2.7%. Fortescue Metals Group surged 4.2% to its highest in over a decade.
Mining stocks are set for a weekly gain of nearly 5% and have risen over 17% this year on the back of rising prices supported by disruptions to supply.
Energy stocks also soared after oil futures rose more than 1% as tensions in the Middle east grew, stoking worries of a hit to supply.
Woodside Petroleum rose 1.5% while Santos tacked on 1.4%.
Healthcare stocks were bolstered by CSL which rose 1.9%, while Cochlear advanced 2.3%.
Financial stocks inched lower, shedding early gains. Commonwealth Bank of Australia edged down, while Westpac Banking Corp largely dragged the index, falling as much as 0.9%.
Meanwhile, New Zealand’s central bank revoked Australia and New Zealand Banking Group’s local unit’s ability to autonomously assess its risk capital requirement, citing persistent shortcomings.
ANZ’s shares dropped as much as 2.7%, reversing course from early gains.
Financials are set to post a drop of over 3% across the week and notch a 3-week losing streak after coming under pressure, as top banks traded ex-dividend during the week.
Bucking the trend, gold stocks plunged as much as 2.6% after gold prices posted a steep decline amid return of risk appetite.
Across the Tasman Sea, New Zealand’s benchmark S&P/NZX 50 index rose 0.4% or 43.07 points to 10,220.06. It hit a record high for a third straight session.
Dairy firm a2 Milk Company rose 0.4%, while Fonterra Shareholders’ Fund edged slightly higher. (Reporting by Rashmi Ashok in Bengaluru; Editing by Kim Coghill)