Australia shares hit 3-week high on global economic optimism

Reuters - UK Focus

* ASX 200 adds 0.7 pct to touch a 3-week high

* Gains broad-based, banks and miners lead

* Stronger global data support sentiment (Adds analysis, quotes, stocks on the move)

By Thuy Ong and Naomi Tajitsu

SYDNEY/WELLINGTON July 3 (Reuters) - Australian shares rosebroadly to scale a 3-week peak on Thursday, steered by moresigns of economic momentum in the United States, yet anotherrecord high on Wall Street and gains for metals prices.

After a soft month in June, institutional investors werealso busy picking up bargains as a batch of data stoked renewedoptimism about the health of the global economy.

"Investors do all the portfolio rebalancing in June to closeup the financial year and the money they have left on thesidelines of the whole process, they generally put it into themarket at lower levels," said Stan Shamu, market analyst at IG (LSE: IGG.L - news) .

On Wednesday, the Dow and the S&P 500 closed at recordhighs, after figures from payrolls processor ADP added to astring of bullish U.S. data. The ADP data raised hopes thegovernment's payrolls report due later Thursday would confirm astrong rebound in the U.S. economy after a first-quarter slump.

The S&P/ASX 200 index climbed 0.7 percent or 38.8points, to 5,494.2, its highest mark since June 10, by 0243 GMT.The benchmark jumped 1.5 percent from 2-1/2 month lows onWednesday, its biggest one-day percentage gain in two weeks

Blue-chip miners, BHP Billiton Ltd added 0.9percent, and Rio Tinto Ltd (Xetra: 855018 - news) gained 0.7 percent,supported by copper prices rising to its highest in more thanfour months after the strong U.S. data raised hopes of a pick upin demand.

The 'Big Four' banks continued their run higher as investorschased their high yields, with Westpac Banking Corp adding 1 percent and Commonwealth Bank of Australia (Other OTC: CBAUF - news) climbing 0.5 percent.

CBA said on Thursday it will set up an independent reviewprogramme for customers of is financial planning division, aweek after a Senate committee report accused it of covering up amisconduct that left thousands of its customers without theirsavings.

Weaker-than-expected Australian retail sales for May drew amixed reaction from stocks in that space.

Takeover target David Jones Ltd declined 0.3percent, although rival department store operator Myer HoldingsLtd managed to tack on 0.5 percent.

Meanwhile, Australia's competition regulator expressedconcerns about two takeovers being pursued by South Africa'sWoolworths Holdings Ltd's, arguing the deals mightbenefit billionaire retail investor Solomon Lew unfairly.

New Zealand's benchmark NZX-50 index edged up 4.6points to 5,1536.85, led by a 2 percent rise in Diligent BoardMember Services, after its stock sank to a six-monthlow of NZ$3.80 last week.

The NZX-50 has been supported near a lifetime high around5,232 hit in April, but trading has been subdued as investorsdigest a series of IPOs, including corporate travel softwaredeveloper Serko and utilities software developerGentrack late last month. (Editing by Shri Navaratnam)

View Comments (0)