* BHP jumps more than 5% to over 10-month high
* Pot stocks cheer cannabis reclassification by U.N.
* NZ shares extend losses into a third session
Dec 3 (Reuters) - Australian shares settled higher on
Thursday as a rally in iron ore prices and a report that China
will allow some long held-up coal shipments from Australia
lifted heavyweight mining stocks.
The mining index soared 4.6% to its highest in more
than eight years, with disappointing output forecasts from
Brazilian miner Vale SA adding fuel to an iron ore
price rally driven mainly by robust demand in top steel producer
China and partly by supply concerns.
Rio Tinto, the world's biggest iron ore miner,
surged up to 7.2% to its highest since May 2008 and was the
biggest boost to the benchmark, while Fortescue Metals Group
jumped 13.9% to a record high.
The S&P/ASX 200 index closed 0.4% higher at 6,615.3,
extending gains into a third session.
"It's really about the iron ore price today," said Henry
Jennings, a senior analyst and portfolio manager at Marcustoday
"There was some concern out there that this trade spat with
China, with wine being the latest casualty, would escalate. But
Vale's production downgrade pushed the bulls back into iron
Coal producers jumped on a report that China was set to
allow a shipment of Australian thermal coal into the country,
despite a ban on such imports in place amid escalating tensions
between Beijing and Canberra.
BHP Group Ltd, the world's biggest listed miner
with exposure to both iron ore and coal, jumped more than 5% to
its highest in over 10 months.
Elsewhere, Australia-listed pot stocks found support in the
United Nations removing cannabis from the most tightly
controlled category of narcotic drugs.
Financial services firm Macquarie Group added 0.2%
after announcing the acquisition of U.S.-based investment
management firm Waddell & Reed Financial Inc for $1.7
Across the Tasman Sea, New Zealand's benchmark S&P/NZX 50
index fell for a third straight session, closing 0.6%
lower at 12,648.9.
(Reporting by A K Pranav in Bengaluru; Editing by Subhranshu