August 8, 2019 / 3:10 AM / 2 months ago

Australia shares supported by miners, NZ edges up; sentiment still fragile

* Mining stocks boost ASX, Rio Tinto down on ex-div

* Lithium miners surge after solid Albemarle Corp results

* AGL Energy leads losses on weak earnings outlook for 2020

By Devika Syamnath

August 8 (Reuters) - Australian shares were supported by gains in miners, with safe-haven gold stocks taking the lead on Thursday, though sentiment remained fragile as lingering trade tensions and a wave of rate cuts by central banks fed recession fears.

Australia’s S&P/ASX 200 index tacked on 0.2%, or 15.7 points, to 6,535.2 by 0224 GMT.

Stock markets around the world have been hit by intensifying Sino-U.S. trade tensions over the past week, and have only managed small recoveries in patches. Asian stock markets were slightly better off on Thursday as China’s central bank limited the fall in the yuan, a relief to investors worried about a currency war after the United States labelled Beijing a currency manipulator on Monday.

Yet, markets were anxious about global recession risks after central banks in New Zealand, India and Thailand surprised investors in varying degrees by cutting rates on Wednesday. New Zealand headlined the moves with a steep 50 basis-point cut as policymakers scrambled to shield their economies from the fallout of the U.S.-China trade dispute.

In the Australian market, gold stocks hit a record high as their safe-haven status enjoyed wider market appeal. Newcrest Mining Ltd jumped 2.8% to a near eight-year high.

Local lithium stocks such as Orocobre and Pilbara Minerals were the top gainers on the benchmark, surging over 7% after the world’s largest lithium producer Albemarle Corp beat quarterly profit estimates and raised its 2019 adjusted profit forecast.

In the mining space, the world’s biggest miner BHP Group gained as much as 1.3%, while Fortescue Metals rallied 3.8%.

Rio Tinto however, sunk as much as 3.7% to hit an over six-month low as the stock traded ex-dividend.

Australian banking stocks fell as much as 1.4% to an over two-month low.

Commonwealth Bank of Australia, the country’s top lender, extended Wednesday’s losses, down 1.5%, after it had posted its first back-to-back annual profit decline in more than a decade.

AMP Ltd, Australia’s biggest wealth manager, posted its biggest half-year loss since listing and withheld paying a dividend for the first time as customers pulled their money, but said a long-awaited sale of its life insurance unit was back on.

Trading was halted for shares of AMP before the announcement. The “big four” banks fell as much as between 1.4% and 1.5%.

Australia’s top power producer AGL Energy tumbled 6.3% to its lowest in over eight months after it flagged weaker earnings for fiscal 2020 as it copes with a unit outage at a power station in Victoria.

Treasury Wine Estates was also in the red, down as much as 7.7% after Hong Kong-based GMT Research alleged that the world’s largest standalone winemaker may have used acquisition accounting to inflate profits.

New Zealand benchmark S&P/NZX 50 index was 0.1% higher at 10,792.94. It had gained 1.9% in the previous session after the central bank’s hefty rate cut.

Adventure goods retailer Kathmandu Holdings rocketed nearly 17% for its best session in over eight months on strong preliminary annual sales.

Reporting by Devika Syamnath in Bengaluru Editing by Shri Navaratnam

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