July 5, 2018 / 6:55 AM / 9 months ago

Financials lead Australian shares higher as investors hunt for bargains; NZ up

* Aussie shares recover Wednesday’s losses

* Financial stocks support the index

* Weak commodity prices continue to weight on miners (Updates to close)

By Nikhil Nainan

July 5 (Reuters) - Australian shares closed half a percent higher in light trade on Thursday as investors sought bargains in the absence of guidance from financial markets in the United States, which were closed for Independence Day. The S&P/ASX 200 index recouped Wednesday’s losses adding 32.1 points to end the session at 6,215.5, its highest close in about two weeks.

The benchmark fell 0.4 percent on Wednesday.

Financials accounted for more than half the gains, with the main financial index climbing 1 percent.

The “Big Four” banks were the biggest gainers, with Commonwealth Bank of Australia and Australia and New Zealand Bank up 1.2 percent each.

“The banks have been sold down recently due to the Royal Commission and other headwinds the financial sector is facing,” said Christopher Conway, head of research and trading at Australian Stock Report.

“The biggest story today is bargain hunting in those beaten down spaces.”

Conway was referring to the Royal Commission enquiry into misconduct by financial institutions in Australia, which has exposed widespread wrongdoing including fraud by financial planners, deception of regulators and charging customers fees without providing a service.

Miners continued their poor performance this week as commodity prices continued to weaken ahead of the Trump administration’s Friday deadline to impose tariffs on $34 billion of worth of Chinese imports into the United States.

Global miner Rio Tinto fell 1.2 percent to a 2-1/2 month low, while peer BHP closed 0.5 percent down, its lowest in over a week.

Leading telco Telstra, which has had a troubled year so far, concluded a fourth session of gains, boosting other stocks on the telecom index, which ended 1.7 percent up.

Telstra climbed 1.9 percent.

“Telecom stocks are heavily weighted against Telstra, which we know has not performed well over the last couple of years, and that’s what is driving gains in the telecom sector,” Conway said.

Following a subdued start, New Zealand’s benchmark S&P/NZX 50 index rose 0.4 percent, or 37.21 points to finish the session at 9,062.85.

Auckland International Airport drove the gains, rising 2.4 percent, with index heavyweight a2 Milk Company up 1.3 percent. (Reporting by Nikhil Kurian Nainan in Bengaluru; Additional reporting by Mensholong Lepcha Editing by Eric Meijer)

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