SYDNEY: Australian shares rose about 0.5 percent in morning trade on Friday, buoyed by data showing signs of strength in the US economy, though gains were capped by persisting worries over Europe's debt crisis.
US stocks rose on Thursday after higher-than-expected profit at FedEx and two strong regional manufacturing surveys and other data outweighed more warnings about Europe.
"We're bursting through the gates pretty well this morning, certainly it's a bit of a relief from the battering we've had over the last week or so, but an unsurprising start given the performance in major markets overnight," said Michael Heffernan, senior client adviser and strategist Austock Group.
The underlying S&P/ASX 200 index was up 20 points at 4,159.8 by 0033 GMT, after three straight days of losses. The index fell 1.2 percent on Thursday.
As things stand, the benchmark is on track to fall about 1 percent for the week.
"The American economy is continuing to improve and they are still the biggest economy in the world, let's not forget that, so if America is doing well that is going to help us all," said Heffernan.
"And Spain issued some bonds and that surprised everybody with the quite strong demand," he added.
Shares in Australian electronics retailer JB Hi-Fi tumbled 13.7 percent after the company warned on Thursday that first-half earnings would fall 5 percent, blaming a price war as rivals sold products at a loss to move stock, but said sales were improving heading into Christmas.
Retailers David Jones, Myer and Harvey Norman were also bruised by heavy falls, all down more than 4 percent in morning trade.
Global miners BHP Billiton and Rio Tinto both rose by more than 0.5 percent after rebounding from recent falls.
Australia's big four banks were also higher, NAB rose 0.8 percent and Westpac was up 0.1 percent.
New Zealand's benchmark NZX 50 index inched up 1.4 points to 3,264.5.
STOCKS ON THE MOVE
Shares in Australia's Bendigo and Adelaide Bank remain in trading halt after the compnay said on Friday it was buying the Australian unit of Bank of Cyprus for A$130 million ($129.02 million) and would launch a share sale to fund the deal.
Insurance Australia Group Ltd shares rose 0.8 percent to A$3.13 after news it will buy troubled New Zealand insurer AMI Ltd for NZ$380 million ($286 million), the company said on Friday.
Shares in Australia's Coca-Cola Amatil rose 1.7 percent to A$12.02, despite saying it expected reported net profit to slip by 0.5 percent in the second half, hurt by a translation of offshore earnings.
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