(Adds analysis, quotes, stocks on the move)
SYDNEY, Feb 25 (Reuters) - Australian shares rose to 5-1/2year highs on Tuesday morning (Frankfurt: TDM.F - news) , supported by gains in thebanking sector and a jump in QBE Insurance (Other OTC: QBEIF - news) shares on optimismprofit margins will improve in 2014 despite the insurersuffering an annual loss.
A largely upbeat earnings season has given the market freshimpetus in recent weeks, with many of the blue-chip banking andmining companies putting up strong performances.
QBE Insurance Ltd posted a loss of $254 million,but its shares climbed 3.8 percent to 6-week highs of A$12.09 asthe company said it would refocus its growth initiatives andforecast premiums to grow 2.5 percent in 2014.
The S&P/ASX 200 index rose 0.2 percent, or 10points, to 5,449.8 by 0113 GMT, after earlier touching a high of5,461.7 -- its highest point since June 2008. The benchmark hasrisen for eight consecutive sessions, its longest streak sinceJanuary 2013.
The market has rebounded from a loss of 3 percent in Januaryto add 4.9 percent so far this month on the back of a healthyearnings season.
"We're up 8 percent over the past couple of weeks. There wasa lot of good moves on the earnings, I think the earningsweren't as bad as people feared," said Shawn Hickman, managingdirector of Market Matters in Sydney.
Putting the shackles on the market in early trade, resources stocks lost ground as copper fell to its lowest inmore than two weeks. Index heavyweights BHP Billiton Ltd and Rio Tinto Ltd (Xetra: 855018 - news) lost 0.6 percent and 0.7percent respectively.
IOOF Holdings Ltd tumbled 5.6 percent after thefinancial services provider reported its first half earnings, up11 percent to A$368.3 million.
"The actuals were just okay, they were probably softer thanexpected," said Evan Lucas, market strategist at IG (LSE: IGG.L - news) inMelbourne. "The fact that guidance is weaker with no actualphysical numbers given, it's why you're seeing IOOF off."
Ramsay Health Care Ltd soared 6.7 percent to alltime highs of A$47.55 after the company said its first halfrevenue from services increased by 13.9 percent to A$2.36billion.
Papua New Guinea's Oil Search Ltd was put on atwo-day trading halt as it is working on a significantacquisition, the oil and gas producer said.
U.S. stocks jumped overnight, with the S&P 500 climbingabove key resistance to a record high, as optimism over mergeractivity helped Wall Street erase this year's early weakness.
New Zealand's benchmark NZX 50 index edged 0.1percent higher to 4,976.2.
(Reporting by Thuy Ong; Editing by Shri Navaratnam)
- Investment & Company Information
- Commonwealth Bank of Australia
- QBE Insurance
- National Australia Bank