Australian shares lifted 0.7 percent on Tuesday, as stronger consumer sentiment underpinned shares in the recently battered banking and mining stocks, though weakness in energy shares capped broader gains. The S&P/ASX 200 index added 38.2 points to 5,245.6 at the close of trade, its second day of gains. The benchmark closed 1 percent higher on Tuesday.
New Zealand's benchmark NZX 50 index added 0.3 percent or 17 points to finish the session at 5,162.9. Investors bought into battered mining and financial stocks. Three of the 'Big Four' banks gained, with Westpac Banking Corp adding 0.4 percent and Commonwealth Bank of Australia up 1.1 percent. Australia and New Zealand Banking Group bucked the trend, shedding 0.1 percent.
A measure of Australian consumer sentiment rose in October, steadying from a sharp fall in the previous month as households signalled they were more confident about the longer-term economic outlook. The benchmark index hit an eight-month trough of 5,122.0 on October 13 and has since rebounded modestly from that support level as investors bought into battered stocks. The S&P/ASX 200 dumped almost 6 percent in September as a rout in iron ore prices, concerns about global growth and a rise in bond yields left investors scurrying into other assets.
"In a positive sign for the bulls, the current sell-off is beginning to look technically overdone," said Tim Radford, global investment manager at Rivkin Securities in a note to clients. "The VIX volatility index is at historically overbought levels." Among miners, Rio Tinto Ltd rose 0.1 percent as it reported a strong third quarter, with a 12 percent rise in iron ore production, while rival BHP Billiton Ltd added 0.5 percent.
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