May 24 (Bloomberg) -- Australian mining stocks gained, led by Rio Tinto Group and BHP Billiton, after the price of copper climbed to a two-week high and Merrill Lynch & Co. said global economic growth justifies higher metals prices.

Woodside Petroleum Ltd. and Santos Ltd. led oil producers lower after crude futures dropped 2.1 percent.

The S&P/ASX 200 Index eased 0.30 point to 3395.10 as of 1:20 p.m. in Sydney. About three stocks fell for every two that gained.

``We're still happily overweight Rio,'' said Jim Reid, who helps manage $324 million at Trust Co. of Australia Ltd. in Sydney. ``It's big and diversified enough to take full advantage of the rise in metals prices.''

New Zealand's NZSX 50 Index added 032 percent to 2602.72 as of 3:21 p.m. in Wellington. Contact Energy Ltd, which makes about a third of New Zealand's electricity, paced gains on optimism its will have certainty of fuel supply for its two biggest gas-fired power stations after agreeing to buy natural gas from the Pohokura field.

Rio Tinto, the world's third-biggest miner, advanced 42 cents, or 1.2 percent, to A$34.12. Merrill Lynch said investors should investors should buy the stock in a report that came out after the market closed Friday, saying global growth will ``continue to be robust, justifying higher metal prices.''

BHP, the world's largest miner, gained 16 cents, or 1.4 percent, to A$11.93. Copper rose 2.9 percent on the London Metals Exchange Friday.

Woodside, Australia's second-biggest oil producer, shed 12 cents, or 0.7 percent, to A$16.30. Santos, the third-biggest producer, dropped a cent, or 0.2 percent, to A$6.55. Crude oil fell after Saudi Arabia, the world's biggest oil producer, said it will boost output and proposed that other members of OPEC raise the group's output quota by at least 8.5 percent.

The S&P/ASX 200 Index's futures contract for June delivery slipped 0.3 percent to 3397. The All Ordinaries Index fell 1.5 points to 3392.70.

The following stocks rose or fell. The stock symbols are in brackets after the company names.

Australian stocks:

ABB Grain Ltd. (ABB AU) added 16 cents, or 2.3 percent, to A$7.01. The world's biggest exporter of malting barley used to make beer said first-half profit rose 38 percent to A$12.4 million ($8.7 million). ABB will pay an interim dividend of 12 cents a share, the company said. The company said it was confident about meeting its earnings forecast of A$18 million to A$19 million for fiscal 2004.

Alesco Corp. (ALS AU): The Australian building products maker's shares were halted from trade. Alesco will raise as much as A$74 million in a share sale to help fund the purchase of garage door maker B&D Doors for at least A$230 million from a group led by buyout firm Catalyst Investment Managers Ltd.

Shareholders will be given the right to buy one share for every five they hold. The shares will be offered between A$5.60 and A$5.90. Alesco shed 4 cents, or 0.6 percent, to A$6.20 on Friday.

General Property Trust (GPT AU) and Lend Lease Corp. (LLC AU): Shares in the companies were suspended from trading before Lend Lease holds a press conference amid speculation it will offer to buy General Property Trust.

The company plans to bid a mixture of cash and shares valuing Sydney-based General Property, the country's fourth- biggest real estate investment trust, at A$6.5 billion ($4.5 billion), the Australian newspaper reported, without saying where it got the information.

Trading in General Property and Lend Lease was halted Friday. Lend Lease rose 3 cents, or 0.3 percent, to A$10.75 on Thursday. General Property Trust fell 2 cents, or 0.7 percent, o A$3.05.

John Fairfax Holdings Ltd. (FXJ AU) added 13 cents, or 3.9 percent, to A$3.44. Australia's second-biggest newspaper publisher raised its full-year earnings forecast, citing a better- than-expected performance from the New Zealand business it bought last year and ``strong'' advertising.

Earnings before interest and tax will be at least A$360 million, Sydney-based Fairfax said in a statement. Analysts are estimating earnings of about A$343 million, Fairfax said.

Leighton Holdings Ltd. (LEI AU) rose 6 cents, or 0.8 percent, to A$7.96. Australia's largest construction company said its Raillink joint venture has won a A$352 million ($246 million) contract to develop the railway between Perth and Mandurah in Western Australia state.

New Zealand stocks:

Contact Energy Ltd. (CEN NZ) gained 2 cents, or 0.4 percent, to NZ$5.54. Contact agreed to buy natural gas from New Zealand's Pohokura field from Royal Dutch/Shell Group, giving it certainty of fuel supply for its two biggest gas-fired power stations.

Mike Pero Mortgages Ltd. (MPM NZ), a New Zealand mortgage broker, fell 5 cents, or 5 percent, to 95 New Zealand cents on its first day of trading.

Mr. Chips Holdings Ltd. (MCH NZ), which processes potatoes into French fries for the restaurant and fast-food industry, added 12 cents, or 12 percent, to NZ$1.12. The company said Friday full-year profit doubled to NZ$2 million ($1.2 million). It expects profit to rise this year. The company's shares didn't trade after the announcement Friday, which was made close to the market close.

National Property Trust (NAP NZ) fell 1 cents, or 1 percent, to 99 New Zealand cents as the stock went ex-dividend. Investors who buy the property investment fund's stock from today won't be entitled to a third-quarter payout of 2.25 cents a share.

Restaurant Brands New Zealand Ltd. (RBD NZ), which owns KFC, Pizza Hut and Starbucks franchises, fell 7 cents, or 5.3 percent, to NZ$1.25. The stock went ex-dividend, meaning investors who buy the shares from today won't be entitled to a 5.5 cent dividend to be paid June 4.

To contact the reporter for this story: Stuart Kelly in Sydney skelly22@bloomberg.net

Last Updated: May 23, 2004 23:25 EDT