August 27, 2019 / 2:34 AM / 2 months ago

REFILE-Australia shares edge up as Trump ratchets down trade war rhetoric

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* Banks, mining stocks lead ASX gains

* High-growth tech units also up, in line with Wall St. peers

* Gold stocks slump after sharp gains on Monday

By Devika Syamnath

Aug 27 (Reuters) - Australian shares inched higher on Tuesday, after comments by U.S. President Donald Trump raised hopes for some de-escalation in the Sino-U.S. trade war, persuading some investors to return to risk markets after a rout in the previous session.

Australia’s S&P ASX 200 index was 0.4%, or 24.8 points, higher at 6,464.9 by 0217 GMT.

The benchmark had given up 1.3% on Monday, in line with a wider market slump after the latest salvoes in the tariff war between the United States and China.

Tensions went down a notch later on Monday when U.S. President Donald Trump flagged the possibility of a trade deal with China and said he believed Beijing was sincere in its desire to reach an agreement.

“Analysts are still very sceptical about the potential for a deal in the near term, the reality is there are still some difficult points to be negotiated,” said Michael McCarthy, chief market strategist at CMC Markets, commenting on the modest moves in the domestic market.

Big miners and banking stocks were responsible for most of the benchmark’s gains.

Mining behemoth BHP Group climbed as much as 1.1%, after losing 2.1% in the last session when the bitter trade war salvo had threatened the outlook for resources, Australia’s biggest export to China.

The “big four” banks also gained between 0.4% and 0.9%.

High-growth tech stocks jumped as much as 2.4%, mirroring overnight moves from tariff-sensitive Wall Street peers such as Apple Inc.

Buy-now-pay-later firm Afterpay Touch was the top gainer on the sub-index, tacking on 8.3% to its highest in over 3 weeks.

Safe-haven gold units lost their charm in the cooler trade landscape, trading as much as 4.4% lower after having gained 6.7% on Monday.

“Movements that we’re seeing (on gold stocks) and the size of them reflects the fact that ... the gold sector is being dominated by traders rather than investors,” said McCarthy.

Gold miners Newcrest Mining, St Barbara and Evolution Mining declined between 3.4% and 6.4%.

Energy stocks did not share in wider relief, down 0.5% after oil prices fell 1% on Monday on the outlook for increased supply of Iranian crude.

Oil and gas firm Santos fell as much as 1.7%.

New Zealand’s benchmark S&P/NZX 50 index was 0.8% lower at 10,572.17. Seafood firm Sanford Ltd led losses, down as much as 2% at an over 5 month low. (Reporting by Devika Syamnath in Bengaluru; Editing by Simon Cameron-Moore)

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