(Reuters) - Australian shares closed at a six-month high on Wednesday, as China's planned fiscal stimulus supported mining stocks and increasing expectations of domestic interest rate cuts lifted broader sentiment.
The S&P/ASX 200 index rose 0.8, or 46.3 points, to 6,245.60. The benchmark declined 0.3 percent on Tuesday.
Economic growth came in at 0.2 percent in the fourth quarter, slower than the 0.3 percent increase forecast by economists in a Reuters poll.
The dismal growth challenges the Reserve Bank of Australia's (RBA) optimistic economic outlook, with investors wagering that the central bank would cut interest rates to stimulate the economy.
Australia's top investment bank Macquarie has revised its rate outlook to two cuts this year from no change previously, as did Westpac and JPMorgan.
Financial shares ended 0.7 percent higher, with the "Big Four" banks gaining with the range of 0.9 percent and 0.2 percent. Commonwealth Bank of Australia and Westpac Banking Corp added 0.9 percent each.
The metals and mining index lead gains among the sectors, rising 1.2 percent on hopes that further stimulus measures by China would help support the cooling economy.
A boost to the Chinese economy bodes well for Australian miners, which export their raw materials to China. Global miners BHP Group Ltd and Rio Tinto Ltd gained 0.9 percent and 1.1 percent, respectively.
Meanwhile, the country's largest department store chain Myer Holdings Ltd jumped 11 percent after the struggling company returned to profitability in the first half.
The positive results also helped boost peers Woolworths Group and Harvey Norman Holdings Ltd, which gained 1 percent and 3.8 percent, respectively.
New Zealand's benchmark S&P/NZX 50 index inched up 0.16 percent or 15.31 points to finish the session at 9,415.00.
Electricity retailer Meridian Energy Ltd added 1.7 percent, while Auckland International Airport Ltd gained 0.2 percent.
(Reporting by Niyati Shetty in Bengaluru; Editing by Sam Holmes)
