News: RIO Australia shares extend gains as RBA heightens hope, NZ inches up

(Updates to close)

Nov 23 (Reuters) - Australian shares advanced for a second straight session on Wednesday, propelled by financials and materials stocks, and boosted by the central bank's positive view on normalising inflation.

The S&P/ASX 200 index (xjo) extended gains to end 1.35 percent, or 73.168 points, higher to 5,484.4 at the close of trade.

The S&P ASX Financials (GIC) .AXFJ rose to its highest in 10 months up by as much as 1.32 percent.

The "Big Four" banks dominated the financial sector, each up around 1.5 percent.

Christopher Kent, the Reserve Bank of Australia's assistant governor, said prospects for stronger growth in nominal demand from the mining states were brightening, which would help in normalising Australia's stubbornly below-target inflation.

Mining stocks rallied as the price of Dalian iron ore soared to hit the 9 percent trade limit.

The ASX 300 Metals and Mining Index .AXMM rose to an almost two-year high, as much as 2.44 percent, where index heavyweights Rio Tinto Ltd (RIO) and Fortescue Metals Group (FMG) gained 2.5 percent and 2.9 percent respectively.

Shares of mining giant BHP Billiton, (BHP) hit a 15-month high, up as much as 2.97 percent.

New Zealand's benchmark S&P/NZX 50 index (nz50) edged up 0.5 percent or 35.06 points to finish the session at 6,851.450.

The benchmark was led by telecom and consumer cyclicals sector with A2 Milk Company (ATM) and Skycity Entertainment Group (SKC) leading gains.

Dairy processor A2 Milk Company surged as much as 7.8 percent after reporting a 96 pct jump in revenue in the first four months of FY17 on Tuesday.

Auckland International Airport (AIA) rose 2.4 percent after reporting a 12.7 percent surge in domestic passengers because of the increased capacity on main trunk and regional services from both Air New Zealand (AIR) and Jetstar.