Australia shares up, set for best week in a month on firmer financials

By Rushil Dutta

July 14 (Reuters) – Australian shares posted broadbased
gains for a second straight session on Friday, and were on track
for their best weekly performance in a month, as financials
tracked their Wall Street counterparts higher ahead of big U.S.
banks earnings.

The S&P/ASX 200 index was 0.5 percent, or 27.37
points, higher at 5,763.70 by 0235 GMT after a 1.1 percent rise
on Thursday. The benchmark has added over 1 percent so far this
week, heading toward its strongest weekly rise since the week
ended June 16.

The day’s gains rode on a solid rise in energy and financial
stocks, with the Australian energy index on track to
record its best trading day since early May with a 2.4 percent
rise.

Aussie energy sector bellwether Woodside Petroleum,
an oil and gas explorer, climbed 2.1 percent boosted by
overnight advances in oil prices, which came on the back of data
showing stronger Chinese demand for crude.

Smaller rivals Oil Search and Santos rose
about 1.7 percent each.

Origin Energy, which has significant natural gas
interests, was also helped by the rise in oil, gaining 2.7
percent and thereby single-handedly pushing up the utilities
sector.

The Australian financial index followed U.S.
financials higher as investors bought in before second
quarter earnings kicked-off with three of the biggest U.S. banks
reporting results.

“Our markets are looking ahead to the reporting
(earnings)from the U.S. with a degree of optimism,” said Tony
Farnham, an economist with Patersons Securities.

A Reuters survey showed second-quarter earnings for S&P 500
companies rose 7.8 percent from a year ago, with financials
projected to have had the third-best profit growth among
sectors.

The Aussie big banks rose in a range of 0.7 percent to 1.2
percent and were the biggest contributors to overall gains.

Meanwhile, the second leg of U.S. Federal Reserve chief
Janet Yellen’s testimony, this time before a Senate panel,
further buttressed her advocacy of a gradual rate of policy
tightening.

Investors have seen Yellen’s dovish tone as a green light
for riskier trades on Wall Street.

New Zealand’s benchmark S&P/NZX 50 index added 0.3
percent or 23.24 points to 7,634.13, and was on track for a
fifth straight week of increases.

Gains were concentrated in consumer, utilities and financial
shares with dairy products maker a2 Milk and energy
retail business Mercury NZ Ltd the biggest advancers on
the benchmark, up 1.5 percent and 3.3 percent, respectively.

(Additional reporting by Chandini Monnappa in Bengaluru;
Editing by Sam Holmes)

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