BHP, Rio Gain on Optimism Mining Tax May Be Dropped

BHP Billiton Ltd. and Rio Tinto Group rose in Sydney trading after the ruling Australian Labor party failed to win a majority at the weekend election, raising optimism its proposed mining tax may be scrapped or diluted.

“We’re seeing some cautious optimism in major stocks like BHP and Rio,”said Tim Schroeders, who helps manage about $1.1. billion at Pengana Capital Ltd. in Melbourne. “There’s a glimmer of hope for the mining sector that things aren’t as dire as they appeared on Friday in terms of a mining tax.”