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Australia shares up after late rally, seen steady

Published: 24 Nov 2009 22:49:51 PST

* S&P/ASX 200 ends at 4,722.2, up 37.2 points

* Strong finish for most banks and miners (Updates to close, adds dealers' comments)

MELBOURNE, Nov 25 - Australian stocks rose 0.8 percent on Wednesday, lifted by banks and miners in thin trade, but dealers see further big gains as unlikely until there is more convincing evidence of a solid global economic recovery.

The S&P/ASX 200 index <.AXJO> rose 37.2 points to finish at 4,722.2 after dipping to as low as 4,673.2.

But it has been hovering between 4,700 and 4,800 over the past two weeks amid a lack of conviction over the health of the global economy and a sense it was looking fully valued, trading at 16 times earnings forecasts for 2010.

"I think the holding pattern will continue for the rest of the year. For resources, we just need more data. The data has to be conclusive enough to get the whole market going again," said George Kanaan, research sales desk-head at UBS in Sydney.

Upbeat comments from a top central banker on Wednesday did not provide much impetus.

Reserve Bank of Australia Deputy Governor Ric Battellino said in a speech that Australia could look forward to years of strong economic growth fuelled by the resources sector, rapid population growth and rising household incomes. [ID:nSYD514867]

"He's dead right, but it's really a case of how the rest of the world is recovering. Comments in Europe and the U.S. aren't that flash," said Patersons Securities dealer Martin Angel.

Banks led the gains, with Westpac Banking Corp <WBC.AX> up 1.7 percent at A$24.37 and National Australia Bank <NAB.AX> gaining 1.6 percent to A$28.43, though Commonwealth Bank of Australia <CBA.AX> fell 0.3 percent to A$52.58.

Top miner BHP Billiton <BHP.AX> also helped, jumping 2.4 percent to A$41.19.

Rival Rio Tinto <RIO.AX> ended down 0.3 at A$71.70. The stock has been dogged by rumours its biggest shareholder, China's Chinalco, was selling down its stake, though dealers in Australia played down the speculation.

Elsewhere, gaming machine maker Aristocrat Leisure <ALL.AX> slid 2.9 percent to A$4.04 after it said U.S. bondholders were seeking damages of around $233 million tied to a five-year-old lawsuit that the company lost. [ID:nSYB008079]

New Zealand's benchmark NZX 50 index <.NZ50> ended up 0.3 percent at 3,115.4. ((sonali.paul@thomsonreuters.com; +61 3 9286 1419; Reuters Messaging: sonali.paul.reuters.com@reuters.net)) ((If you have a query or comment on this story, send an email to news.feedback.asia@thomsonreuters.com)) ((Multimedia versions of Reuters Top News are now available for: * 3000 Xtra : visit http://topnews.session.rservices.com * BridgeStation: view story .134 For more information on Top News, please visit http://topnews.reuters.com))

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