January 8, 2019 / 1:12 AM / 5 months ago

Australia shares rise on Sino-U.S. trade talk hopes; NZ tepid

* Sino-U.S. trade talk hopes buoy Aussie shares

* Financials dominate gains

* Gold stocks fall as risk appetite returns

By Aditya Soni

Jan 8 (Reuters) - Australian shares firmed on Tuesday following an extended Wall Street rally and underpinned by optimism that Beijing and Washington may be inching closer to an agreement to end their bruising trade war.

The S&P/ASX 200 index rose 0.40 percent or 21.20 points to 5,704.40 by 0058 GMT. The benchmark climbed 1.1 percent on Monday.

U.S. officials met their Chinese counterparts in Beijing on Monday for the first face-to-face talks since U.S. President Donald Trump and Chinese President Xi Jinping agreed in December to a 90-day truce.

U.S. Commerce Secretary Wilbur Ross predicted the two sides could reach a trade deal that everyne can live with.

U.S. stocks rose for a second straight day.

“Right now there is a deal coming, the question is what kind of detail we are going to get, so everyone is waiting for that,” said Mathan Somasundaram, a Blue Ocean Equities market portfolio strategist.

“If all the deal brings is no more new tariffs, that is not going to be massively positive but at least it is better than any more tariffs coming.”

Australian markets are highly sensitive to developments in China, the country’s top export market.

Financials, which account for nearly half of the benchmark, rose as much as 0.4 percent.

Index heavyweight Australia and New Zealand Banking Group Ltd firmed 0.5 percent to an over one-week high, while Westpac Banking Corp strengthened 0.7 percent.

Energy stocks also advanced, bolstered by a jump in oil prices.

Whitehaven Coal Ltd climbed as much as 2.8 percent to its highest since Dec. 17, while Origin Energy Ltd rose 1.2 percent to a three-week high.

Meanwhile, Bingo Industries Ltd surged 4.9 percent and was among the top performers.

Earlier in the day, Bingo said it has offered to divest its eastern Sydney waste processing plant to address antitrust concerns related to the waste management firm’s planned acquisition of Dial-aDump.

However, gold stocks fell 1.4 percent, leading losses on the benchmark.

The recent recovery in risk appetite has shrunk the appeal of gold miners, which clocked solid gains in the first week of 2019 amid intense market volatility.

St Barbara Ltd and Northern Star Resources Ltd dropped 2.4 percent and 2.1 percent, respectively.

Across the Tasman sea, New Zealand’s benchmark S&P/NZX 50 index rose 0.1 percent or 5.19 points to 8,811.23.

Financials dominated the gains, with Argosy Property Ltd rising 0.4 percent, while NZX Ltd climbed 1 percent.

Reporting by Aditya Soni in Bengaluru; Additional Reporting by Shriya R; Editing by Kim Coghill

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