BHP, Commonwealth Bank lead Australian Stocks

Australian stocks rose, led by companies with overseas earnings such as BHP Billiton and Westfield Group, after a survey of U.S. manufacturing boosted optimism the Federal Reserve may stop raising interest rates.

Commonwealth Bank of Australia and Australia & New Zealand Banking Group Ltd. gained as some investors chased their steady dividends after the yield on Australia's benchmark 10-year bond sank to a two-year low.

The S&P/ASX 200 Index climbed 41.10, or 1 percent, to 4188.90 as of 10:51 a.m. in Sydney. About five stocks rose for every one that fell. The index has rebounded 6.1 percent from its year-low on May 4, and is 1.8 percent from its March 21 record.

New Zealand's NZSX 50 Index climbed 0.8 percent to 3020.67 as of 12:51 p.m. in Wellington. Tourism Holdings Ltd., the largest mobile-home rental company, gained.

BHP, the world's biggest miner, added 31 cents, or 1.8 percent, to A$ 17.16. Westfield, the world's biggest owner of shopping malls, climbed 19 cents, or 1.1 percent, to A$ 17.24.

The Institute for Supply Management's factory index in the U.S. slipped in May to the lowest level since June 2003, boosting the likelihood the Fed will soon end its series of rate rises.

``If global interest rates aren't going to rise, then there's hope that some of the poor economic data could reverse, which will flow on to stocks as earnings growth gets back on track," said Gary Armor, who helps manage the equivalent of $ 2.9 billion at AMP Capital Investors in Sydney.

Commonwealth Bank, Australia's second-biggest lender, gained 33 cents, or 0.9 percent, to A$38.12. ANZ, the third-biggest bank, added 32 cents, or 1.5 percent, to A$ 22.25.

The yield on Australia's 6.25 percent bond maturing in April 2015 fell 6 basis points to 5.07 percent, making the stocks of companies that pay higher than average yields more attractive to investors seeking steady income. A basis point is 0.01 percentage point.

Stocks in the S&P/ASX 200 Financial Index have an average dividend yield of 4.9 percent, higher than the 3.9 percent average for S&P/ASX 200 Index members.

The S&P/ASX 200 Index's futures contract for June added 1 percent to 4197. The broader All Ordinaries Index rose 0.9 percent to 4141.90.

The following stocks also rose or fell. The stock symbols are in brackets after the company names.

Australian stocks:

Oil producers: Crude prices in New York surged 5.1 percent to $ 54.60 a barrel, the biggest gain in almost six months, as refinery malfunctions raised concern that refiners won't produce enough gasoline to meet peak demand this summer. Oil was at $54.37 as of 10:46 a.m. Sydney time.

Woodside Petroleum Ltd. (WPL AU), Australia's second-biggest oil producer, added 94 cents, or 2.1 percent, to a record A$ 26.35. Santos Ltd. (STO AU), the nation's third-biggest oil producer, rose 24 cents, or 2.3 percent, to A$ 10.60.

General Property Trust (GPT AU) was halted from trading. Lend Lease Corp. (LLC AU), Australia's biggest property developer, signed an agreement with General Property, the third- biggest real estate investment trust, for the handover of management rights should shareholders today approve the trust's plan to ditch Lend Lease as manager of its A$ 9 billion ($ 6.7 billion) properties. General Property added 8 cents, or 2.3 percent, to A$ 3.61 yesterday.

National Australia Bank Ltd. (NAB AU), the nation's largest lender, slid 62 cents, or 2 percent, to A$ 31.16. It's trading from today without the right to its latest dividend of 83 cents.

Phylogica Ltd. (PYC AU) surged 4 cents, or 23 percent, to 21.5 cents. The Australian biotechnology company found new compounds that protect the brain from stroke, it said in a statement. The company estimates the market for stroke treatments to be worth $ 5.4 billion by next year.

United Group Ltd. (UGL AU), an engineering services company, was halted from trading pending an announcement on a "significant transaction" and a related funding agreement. United will buy Alstom SA's (ALS FP) Australian and New Zealand transport business for between A$ 250 million and A$ 300 million, the Australian Financial Review reported today, without saying where it got the information. United yesterday gained 23 cents, or 2.7 percent, to A$ 8.68.

New Zealand stocks:

Air New Zealand Ltd. (AIR NZ), the nation's largest airline, fell 2 cents, or 1.4 percent, to NZ$ 1.43. The company said yesterday it may post a 21 percent drop in second-half earnings because of higher prices for jet fuel.

Tourism Holdings Ltd. (THL NZ), New Zealand's largest mobile- home rental company, added 1 cent, or 0.6 percent, to NZ$ 1.77. Tourism Holdings has 1,150 mobile homes and 70 buses booked for the British and Irish Lions rugby tour this month, during a season when rentals are usually slow, Chief Executive Dennis Pickup said.