Reuters: Hot Stocks: Australia shares up 0.6 pct to 17-mth high as iron ore rallies

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Australia shares up 0.6 pct to 17-mth high as iron ore rallies Dec 18th 2012, 00:29 Mon Dec 17, 2012 7:29pm EST (Updates with comments, stocks on the move) MELBOURNE, Dec 18 (Reuters) - Australian shares climbed 0.6 percent on Tuesday to a fresh 17-month high, with resource stocks propelled by a rise in iron ore prices to five-month highs and by gains on Wall Street on renewed optimism about a resolution to U.S. budget talks. Top miners led the gains, with Rio Tinto up 1.5 percent, while mid-tier miners also benefited. The benchmark S&P/ASX 200 index gained 27.9 points to 4,601.3 at 0012 GMT, after touching a fresh 17-month high of 4,604.4. Still, the Australian market is languishing 33 percent below its all-time high, underperforming many regional peers as investors have been fixated on European fiscal worries and the slowdown in the U.S. economy. "We have focused too much on the U.S. and Europe, which are not that important to us in terms of our exports," said Baillieu Holst director Richard Morrow. "Iron ore is a very key commodity into the Chinese industrial machine, steel usage will bounce back and that is good news for our exporters," Morrow said. Among the mid-tier miners, Atlas Iron was up 5.2 percent and Northern Iron up 9.5 percent. New Zealand's benchmark NZX 50 index rose 0.2 percent to 3,974.5. STOCKS ON THE MOVE * Uranium miners rallied for a second session, getting a boost after the pro-nuclear power Liberal Democratic Party won Japan's election in a landslide. Paladin Energy jumped 6.7 percent to A$1.03, adding to an 8 percent gain on Monday, and ERA Resources rose 6.9 percent to A$1.32. 0002 GMT * Top mortgage lender Commonwealth Bank of Australia moved to expand its hold on the mortgage market, taking majority control of former independent lender Aussie Home Loans, moving to 80 percent from 33 percent for an undisclosed sum. CBA retained the right to move to 100 percent ownership in future. Its shares rose 0.8 percent to A$61.80. 0002 GMT * Qantas Airways gained 3 percent to A$1.437, helped by an unsourced report that Australia's competition regulator was looking favourably on the planned alliance with Emirates. 0000 GMT (Reporting by Victoria Thieberger; Editing by Jeremy Laurence) Link this Share this Digg this Email Reprints

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