* Australia’s trade surplus widened in May
* Afterpay stock hits record high
* NZ shares hit over 3-week peak (Updates to close)
By Pranav A K
July 2 (Reuters) – Australian shares ended at their highest level in three weeks on Thursday, led by financials and technology stocks, as positive developments in a COVID-19 vaccine trial and optimism about fresh stimulus raised hopes of a quicker economic recovery.
Rising for the third straight day, the S&P/ASX 200 index gained 1.7% to 6,032.7, its highest closing level since June 11.
Investors cheered promising results of a COVID-19 vaccine developed by German biotech firm BioNTech and U.S. pharmaceutical giant Pfizer, which was found to be well tolerated in early-stage human trials.
Meanwhile, data showed that Australia’s trade surplus widened in May, but came below expectations of a Reuters poll.
However, Michael McCarthy, chief market strategist at CMC Markets, said the trade data was much better than the “terrible” numbers in April and was helping support the V-shaped recovery story. “At the moment, the optimism around government and central bank stimulus and potential for a vaccine cure is overwhelming the negativity around rising cases in southern states of the U.S. and elsewhere.”
Leading gains in Australia, technology stocks jumped 3.7% to hit a record peak, taking cues from its peers in the United States.
Afterpay Ltd soared 9.5% to hit an all-time high and was the benchmark’s second-biggest gainer after brokerage Citi more than doubled its price target on the buy-now-pay-later firm’s stock.
Heavyweight financials also gained 1.9%, led by the “Big Four” banks.
News of encouraging results about a potential vaccine, coupled with solid U.S. manufacturing data, dented demand for safe havens and pushed gold stocks down 0.2%.
Across the Tasman Sea, New Zealand’s benchmark S&P/NZX 50 index climbed to its highest since June 9, ending up 1.3% at 11,502.52.
Travel equipment retailer Kathmandu Holdings was the top gainer on the index, surging 11.4% on positive same-store sales growth. (Reporting by A K Pranav in Bengaluru; Editing by Rashmi Aich)