(Reuters) - Australian shares returned to positive territory on Tuesday, drawing confidence from a recovery on Wall Street following a chaotic week for equities.
The S&P/ASX 200 index <.AXJO> rose 0.6 percent or 35.2 points to 5,855.9 at the close of trade, after a 0.3 percent slip on Monday.
Wall Street's three major indexes rebounded on Monday with broad-based gains after U.S. equities' had biggest weekly drop in two years, but strategists are wary of calling an end to the rout. [.N]
In Australia, materials were the best performers, led by a 1.2 percent rise in heavyweight BHP Billiton <BHP.AX>. Rival miner Rio Tinto <RIO.AX> gained 1.1 percent to settle at a two-week best.
Copper prices climbed for a second day on a weaker dollar and a bounce-back in global equities, while China iron ore and steel futures crept higher ahead of the week-long Lunar New Year break. [MET/L] [IRONORE/]
Top banks in the region posted limited gains amid a government-backed inquiry into Australia's finance sector that began on Monday.
The inquiry said it will start a year-long investigation by scrutinising the selling tactics for banks' most lucrative products - mortgages.
Investment bank Macquarie Group <MQG.AX> was among the top contributors to the index, up 1.1 percent. Danish telecoms company TDC <TDC.CO> on Monday urged investors to back a $6.7 billion cash offer from Macquarie and three Danish pension funds.
Healthcare major CSL Ltd <CSL.AX> rose 1.3 percent.
Retail property manager Scentre Group <SCG.AX> capped the gains on the index with a 2.1 percent drop, settling at its weakest since early October.
New Zealand's benchmark S&P/NZX 50 index <.NZ50> broke a five-session run of losses, rising 0.8 percent or 63.16 points to finish the session at 8,122.22.
Dairy and healthcare stocks boosted the index, with a2 Milk <ATM.NZ> climbing 3.1 percent and Fisher & Paykel Healthcare Corporation Ltd <FPH.NZ> up 1.6 percent.
(Reporting by Chris Thomas in Bengaluru; Editing by Eric Meijer)
