WBC Westpac Banking Corp

   By Robb M. Stewart 
 

MELBOURNE, Australia--Overnight gains in commodity prices helped buoy Australian resources stocks and the broader market Tuesday.

In another day of choppy trading, the S&P/ASX 200 finished 41.4 points, or 0.9%, higher at 4922.3. It was the first substantial move in the index in the last four sessions.

The push higher was led by gains in energy and mining stocks, with additional support from banks, which are heavily weighted.

Oil prices advanced Monday on signs that U.S. drilling activity is hitting new lows, while copper prices shook off losses and turned positive in the last half hour of the day's trading session. Gold rose to its highest level in nearly three weeks in Asia trading Tuesday, boosted by weak U.S. economic data and news that China cut reserve-requirement ratios for banks.

After declining the past four sessions after reporting a first-half loss and sharply reduced dividend, BHP Billiton recovered with a jump of 3%. Rio Tinto rose 2.7%, while fellow iron-ore producer Fortescue Metals Group gained 6.4%. Newcrest Mining was 4.5% higher.

Among energy stocks, Woodside Petroleum and Oil Search each added 1.8% and Santos and Oil Search each climbed 3.6%.

The big four banks were all higher for the day, led by a 3% increase in Australia & New Zealand Banking Group. Westpac added 2.5%, National Australia Bank was 2% higher and Commonwealth Bank of Australia was up 1.8%. All four have seen heavy selling for much of 2016.

"The compelling yields on offer in Aussie banks look to have finally brought buyers back to the markets, and ANZ was gaining the most on their compelling historically low valuation," Angus Nicholson, a market analyst at IG in Melbourne, said.

For the day, 2.8 billion shares were traded worth 6.4 billion Australian dollars (US$4.57 billion), Commonwealth Securities said.

The market largely brushed aside the Reserve Bank of Australia's decision to leave its key cash rate unchanged at a 2% for a ninth consecutive policy meeting, even as it left the door open to cutting further if the economy slows later in the year. The government's statistics office is scheduled to release fourth-quarter economic growth data on Wednesday.

Write to Robb M. Stewart at robb.stewart@wsj.com

(END) Dow Jones Newswires

March 01, 2016 01:08 ET (06:08 GMT)

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