MSN: Australia shares hit 3-week high; banks, miners lead
By Victoria Thieberger
MELBOURNE, Dec 7 (Reuters) - Australian stocks rallied 0.8 percent on Tuesday, led by gains in the top miners and banks on hopes that an extension of U.S. income tax cuts would help support growth in the U.S. economy.
Traders said sentiment was boosted by news after Wall Street closed that U.S. President Barack Obama has reached a compromise deal to extend all Bush-era tax cuts for two years [ID:nN06211347].
"That would have been a disappointment if they had not reached agreement, so you would expect financials (on Wall Street) to have a reasonable night tonight on the back of that," said Karara Capital dealer Phillip Weinberg.
Banks extended gains in the afternoon, but showed little reaction to a widely anticipated decision by the central bank to hold borrowing costs steady, after seven hikes over the past year. For details, see [ID:nL3E6N601C]
Banks added between 1.0 percent and 1.2 percent, led by Westpac which added 1.2 percent.
The benchmark S&P/ASX 200 index rose 38.2 points to 4,726.8, the highest close since Nov. 11. The index slipped 0.1 percent on Monday.
New Zealand's benchmark NZX 50 index slipped 0.3 percent to 3,281.8.
Just after the close, one of Australia's largest buyout firms Pacific Equity Partners said it had approached salmon farmer Tassal Group over a possible bid of A$1.80 to A$1.90 a share. The stock had closed down 1.6 percent at A$1.585.
Shares in Westfield Group rose 0.4 percent to A$12.33 after the shopping mall owner raised A$2.01 billion ($1.99 billion) for its newly created retail trust, but fell well short of its A$3.5 billion target.
The resource sector was supported by continued solid gains in commodities markets, as copper rose to a three-week high on talk of further monetary easing by the U.S. Federal Reserve and gold hit a record.
Miners BHP Billiton and Rio Tinto closed up 1.2 percent and 1.6 percent respectively,
Shares in top gold miner Newcrest added 1.0 percent to A$41.50 after the precious metal touched a fresh record overnight, before easing on profit-taking in Asia.
Newcrest said it expects to boost gold output to 3.75 million ounces in fiscal year 2014 from 2.74 million ounces in 2010. [ID:nSYU010724]
India's Tata Steel , the top shareholder in Africa-focused Riversdale Mining , said it regarded its 24.2 percent stake as strategic and would respond as necessary to any bid by global miner Rio Tinto for Riversdale. [ID:nL3E6N600F]
Riversdale shares eased 2.7 percent to A$15.87 after surging 15 percent on Monday on the Rio bid.
The initial public offering of Philippine nickel, copper and gold explorer Mindoro Resources Ltd was positive, with the shares opening at A$0.27, a premium of 35 percent to the A$0.20 issue price for a market capitalisation of A$55 million.
Mindoro closed its maiden day up 15 percent at A$0.23 for a market capitalisation of A$46 million.
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