* Aussie shares rise as investors look past trade tensions
* Banks lead gains on the benchmark
* Materials and energy knocked by lower commodities and oil prices
* NZ falls on healthcare weakness
By Aditya Soni
July 12 (Reuters) - Australia’s main stock index bounced back on Thursday, led by gains in bank and healthcare shares, but miners and oil producers fell on fears that a rapidly escalating U.S.-China trade dispute will slow global demand.
The S&P/ASX 200 index rose 0.7 percent or 42.90 points to 6,258.50 by 0200 GMT.
The benchmark had dipped 0.8 percent on Wednesday, after Washington’s threat to impose tariffs on a further $200 billion of Chinese imports rang alarm bells across financial markets.
China has accused the United States of bullying and warned it could hit back, although it was unclear how it would retaliate.
“The news of extra tariffs dominated the global markets... and clearly our markets priced it in,” said James McGlew, Executive director of corporate stockbroking at Argonaut.
Banks led the recovery in local stocks on Thursday, with the financial index jumping 0.8 percent.
Australia’s banking watchdog on Wednesday said its intense crackdown on risky mortgage lending was largely complete, as higher lending rates were also helping cool the country’s housing market.
“The APRA comments put a bit of momentum back into a sector that’s been well and truly beaten up through the process of the Royal Commission here,” said McGlew.
Top lender Commonwealth Bank of Australia climbed 0.9 percent, while Westpac Banking Corp rose 1 percent, its biggest intraday percentage gain in nearly three-weeks.
Health care stocks also advanced, propping up the benchmark.
CSL Ltd, the country’s fifth largest firm by market value, firmed 1.7 percent, while hearing aid maker Cochlear Ltd strengthened 2.3 percent to a more than one-week high.
However, a slump in oil and commodities prices drove down energy and materials stock, capping the benchmark’s rise.
Global benchmark Brent crude oil had its biggest one-day drop in two years on Wednesday, putting pressure on oil-focused firms.
Woodside Petroleum Ltd dipped 1.5 percent, while Oil Search Ltd fell as much as 4 percent to a more than two-week low.
A plunge in base metal prices on Wednesday, lead by a three percent drop in London copper pushed materials stock, especially miners lower.
Index heavyweight BHP Ltd slipped 0.8 percent, while its spin off South32 Ltd slid 1.1 percent.
Meanwhile, New Zealand shares edged lower, with the benchmark S&P/NZX 50 index slipping 0.1 percent or 4.78 points to 8,996.61.
Health care stocks underpinned the bearish trend, with Ryman Healthcare Ltd and EBOS Group Ltd dipping 0.9 percent and 0.6 percent, respectively.
Elsewhere, A2 Milk Company Ltd reversed from losses earlier in the session to rise 0.3 percent.
The dairy product maker said annual revenue grew nearly 70 percent to around NZ$922 million ($622.26 million) and flagged higher costs going forward to ramp up its China business to compete in the dairy-hungry market.
$1 = 1.4817 New Zealand dollars Reporting by Aditya Soni in Bengaluru; Additional reporting by Devika Syamnath; Editing by Kim Coghill