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ASX shows strength as eyes on China talks

Derek Rose

Another day of gains for the Australian share market has traders wondering if the four-month downtrend is finally over.

The benchmark S&P/ASX200 index closed up 39.2 points, or 0.69 per cent, to 5,722.4 at 1415 AEDT on Tuesday, with technology, health care and the financial sector lifting the bourse.

The broader All Ordinaries was up 38.8 points, or 0.68 per cent, to 5,783.3.

All the major sectors were higher although gold miners were under pressure.

"A surprisingly strong day," said Michael McCarthy, chief market analyst with CMC Markets. "It looks like local investors are prepared to get on with it."

The ASX has gained 5.8 per cent in the 15 days since Christmas Eve but is still down almost ten per cent from its highs in late August.

"It's been a big argument on the desk, whether we've seen a corrective rally or the end of the three-month downtrend and a turnaround for global sharemarkets," McCarthy said.

Traders were keeping a watchful eye on the trade talks between the US and China in Beijing that could spell an end to the damaging trade war.

The biggest performers included Mayne Pharma, up 8.23 per cent, to 85.5 cents; Sigma Health, up 5.31 per cent, to 59.5 cents; and Syrah Resources up 5.34 per cent to $1.775.

McCarthy attributed those gains to bargain hunting and traders covering short positions.

Telstra gained 1.75 per cent, to close at $2.90, while health care giant CSL gained 1.29 per cent, to finish at $189.92.

The big banks led losses in the morning, but were mostly ahead at the close, with ANZ, NAB and Westpac up by between 0.91 and 1.19 per cent, and Macquarie Group outpacing the lot with a 1.9 per cent rise to $112.67.

Magellan Financial Group rose 4.04 per cent, to $24.48, after the fund management company said it had $41 million more under management in December.

Superannuation and investment platform HUB24 rose 7.72 per cent to $12.51 after it announced it had reached a $10 billion funds under administration milestone.

The mining giants had a more subdued day, with BHP edging 0.12 per cent higher to close at $34.43.

Healius shares gained 1.55 per cent, to $2.62, as investors wondered what was next with Jangho Group's highly conditional bid of $3.25 a share. The Healius board on Monday urged shareholders to reject the offer.

Bank of Queensland shares rose 1.63 per cent, to $9.97, after the lender became the first bank to officially hike home loan rates out of cycle in 2019.

It was a good day for gambling stocks with Tabcorp Holdings up 3.26 per cent, to $4.43, and gambling machine manufacturer Aristocrat Leisure up 3.24 per cent, to $22.62.

The Australian dollar was buying 71.29 US cents, from 71.46 cents on Monday.

ON THE ASX:

* The benchmark S&P/ASX200 index was up 39.2 points, or 0.69 per cent to 5722.4

* The All Ordinaries was up 38.8 points, or 0.68 per cent, to 5783.3.

* At 1415 AEDT, the SPI200 futures index was down 3 points, or 0.05 per cent, to 5660.

CURRENCY SNAPSHOT AT 1415 AEDT:

One Australian dollar buys:

* 71.29 US cents, from 71.46 on Monday

* 77.67 Japanese yen, from 77.685

* 62.30 euro cents, from 62.28

* 55.86 British pence, from 55.95

* 1.0578 NZ cents, from 1.0582

GOLD:

The spot price of gold in Sydney at 1415 AEDT was $US1,282.90 per fine ounce, from $US1,288.80 on Friday.