Australian shares rise on hopes of US-Iran talks

By Anjali Singh

April 14 (Reuters) - Australian equities rose on Tuesday, buoyed by heavyweight miners, as risk sentiment improved on hopes of a resolution to the Middle East war, with Washington and Tehran keeping the door open for dialogue.

The benchmark S&P/ASX 200 index .AXJO rose 0.5% to 8,970.80 points. The index fell 0.4% on Monday after the peace talks in Islamabad fell through and the U.S. announced the blockade of Iranian ports, which took effect later that day.

Asian stocks rose, and oil prices and the safe-haven dollar fell, while a U.S. official said there were attempts at sealing an agreement with Iran. MKTS/GLOB

Jamie Hannah, deputy head of investments and capital markets at VanEck Australia, cautioned that the Australian equity market may be overlooking inflation risks and stretched valuations.

These pressures should play out over time if the conflict drags on and oil prices climb further, Hannah said, adding that such risks might not have been priced in yet.

Policymakers have raised similar concerns as well, with the Reserve Bank of Australia Deputy Governor Andrew Hauser saying on Tuesday that he was not confident that the current interest rate level could curb inflation, fuelled by cost pressures from the conflict.

Miners .AXMM rose nearly 2% to their highest level in more than a month and snapped a three-day losing streak on the back of robust iron ore prices. IRONORE/

BHP BHP.AX climbed 3.2% as sources told Reuters that top consumer China has lifted bans on the procurement of the key steelmaking ingredient from the Australian mining major.

Rio Tinto RIO.AX and Fortescue FMG.AX gained 1.3% and 1.6% respectively.

Gold miners .AXGD rose 0.3% on strong bullion, while technology stocks .AXIJ added 3.4%, mirroring the rise in their U.S. peers. GOL/

Energy stocks .AXEJ added 0.3%, defying a near 2% drop in oil prices on easing supply concerns. O/R

New Zealand benchmark S&P/NZX 50 index .NZ50 closed flat at 13,017.26.