By Robb M. Stewart
MELBOURNE, Australia--Australia's stock market racked up its
strongest one-day gain since mid-February on Tuesday as investors
shrugged off the worries that had weighed heavily on sentiment in
recent days.
Bank shares offered the biggest boost to the local market,
resuming a recent recovery interrupted over the past couple of
days, while broad buying also lifted resources stocks despite a
further slump in crude-oil and iron-ore prices.
The S&P/ASX 200 finished up 106.4 points, or 1.9%, at
5581.4. That took back a big chunk of the nearly 125-point fall
over the previous two trading sessions as worries built over
Greece's worsening debt crisis and the continued fall in Chinese
shares.
Australia's central bank during the day opted to leave its
benchmark cash rate on hold at a record-low 2%, as expected, and
made only a passing reference to China and Greece. RBA Gov. Glenn
Stevens gave little away about where rates are heading or when,
although a number of economists continue to expect at least one
more cut this year.
"While today's gains are encouraging, I still feel the ASX 200
remains largely range-bound with upside likely to be capped in the
5600 region," Stan Shamu, a market strategist at IG in Melbourne,
said.
Shares in the largest banks, which are sought by investors for
their attractive dividend yield but have faced heavy selling from
late March highs, were all higher for the day.
Commonwealth Bank, the largest lender by market value, ended up
1.6%, although it remains almost 9% below its March closing high.
Westpac jumped 3.9%, while Australia & New Zealand Banking and
National Australia Bank added 2.6% and 2.2%, respectively.
Investment bank Macquarie rose 1.3%.
Among energy shares, Santos lost 0.5% but Woodside Petroleum
added 1.5% and Oil Search gained 3.1%.
BHP Billiton rose 0.9%, Rio Tinto gained 1.1% and iron-ore
producer Fortescue Metals Group climbed 4.1% despite the price of
the steelmaking ingredient falling another 3.9% on Monday to US$52
a metric ton.
Qantas Airways, which benefits from a fall in oil prices,
advanced 7.9%.
Write to Robb M. Stewart at robb.stewart@wsj.com