Australian shares snapped a three-day losing streak on Monday, helped by further evidence that the U.S. economy is gaining strength and signs that Chinese inflation is stabilizing.
The S&P/ASX 200 index increased by 0.4% or 20.8 points to 5724.4, although early gains that flowed from a positive session on Wall Street on Friday and upbeat jobs data were pared as the session wore on. The key data point Monday was China's consumer price index, which rose by 1.5% compared with a year ago in June to stabilize after several months of falls.
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Financial stocks were mostly higher on a thin day for corporate news. Commonwealth Bank of Australia, the market's biggest constituent, rose by 0.8% to A$82.81 while Australia & New Zealand Banking Group Ltd. edged up 0.4% to A$28.74.
However, CSL Ltd. fell after a competitor claimed in a U.S. lawsuit that Australia's biggest drug maker had infringed three of its patents. The legal action centers on CSL's Idelvion treatment for hemophilia, which was approved in the U.S. in March last year. CSL, which closed 0.6% lower at A$133.32, said it was "highly confident" about its intellectual property.
Energy stocks were mixed, despite oil prices rebounding from declines on Friday amid a stronger U.S. dollar and persistent oversupply worries. Nymex crude for delivery in August was recently up 0.8% at US$44.57 a barrel in the Globex electronic session, while Brent crude for delivery in September rose by 0.8% to US$47.07. Woodside Petroleum Ltd. gained 0.1% to A$29.41, but Santos Ltd. fell by 1.4% to A$2.91.
AGL Energy Ltd. advanced 0.2% to A$25.00 after Macquarie upgraded the stock to neutral from underperform. Still, the brokerage was hardly upbeat on the electricity retailer and generator, saying shrinking power demand continues to be an ill wind.
BHP Billiton Ltd. fell by 0.3% to A$24.52, even as Credit Suisse signaled that its U.S. onshore oil and gas assets weren't being appropriately valued by investors. The brokerage used a new algorithm to test how much the shale acreage was worth and came up with a US$11 billion valuation.
Credit Suisse noted that hedge fund Elliott Management Corp., which is agitating for BHP to sell the assets, has put consensus valuations at US$6.5 billion.
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(END) Dow Jones Newswires
July 10, 2017 02:41 ET (06:41 GMT)