Australia Stocks: Babcock, Centro, National Australia Bank, Rio

By Shani Raja

Aug. 25 (Bloomberg) -- The S&P/ASX 200 Index rose 87.50 points, or 1.8 percent, to 5,018.90 at 10:20 a.m. in Sydney, the most in almost three weeks. The broader All Ordinaries Index added 88.70 points, or 1.8 percent, to 5,098.90, while the futures index expiring in September advanced 2.3 percent to 5,006.

Financial stocks: National Australia Bank Ltd. (NAB AU), the nation's largest lender by assets, gained 57 cents, or 2.4 percent, to A$24.12, the most since Aug. 12. Commonwealth Bank of Australia (CBA AU) advanced 78 cents, or 1.9 percent, to A$42.16.

U.S. stocks advanced, led by banks and retailers, on oil's biggest plunge in four years and speculation a purchase of Lehman Brothers Holdings Inc. would end the worst slump by financial shares since at least 1962. The Standard & Poor's 500 Index added 14.48 points, or 1.1 percent, to 1,292.20.

Babcock & Brown Ltd. (BNB AU), an Australian manager of infrastructure assets, rose 18 cents, or 7.3 percent, to A$2.26, the eight-best performer on the benchmark. Babcock may seek a buyer for Irish phone company Eircom Group Plc, the Irish Times reported, citing unidentified people.

Centro Properties Group (CNP AU), which won a reprieve this year on debt of as much as A$6.6 billion ($5.7 billion), slumped 2 cents, or 6.8 percent, to a record low 20 cents. Centro may have to offer hybrid securities to win a further extension by Dec. 15, after rejecting proposals for new equity. ``This may impact the value of the group's existing ordinary equity,'' the Melbourne-based company in a statement to the Australian stock exchange.

Rio Tinto Group (RIO AU) rose A$3.45, or 2.9 percent, to A$124.45, the highest since the end of July. Aluminum Corp. of China, or Chinalco, got Australian approval to raise its stake in Rio to 11 percent.

Warrnambool Cheese & Butter Factory Co. (WCB AU), bidding to buy Australia's Dairy Farmers with Kirin Holdings Co., surged 53 cents, or 12 percent, to A$4.93, the most since October 2007. The company said full-year profit rose to a record as it processed more milk into cheese and prices rose.

To contact the reporter on this story: Shani Raja in Sydney at sraja4@bloomberg.net.