Australia shares close higher on banks, energy; NZ flat
[BENGALURU] Australian shares extended gains in thin trade on Friday, fuelled by banks and energy stocks as the index continued to rise after falling to and bouncing back from an important support level earlier this week.
While broader Asian shares slipped amid worries over cooling global growth and trade tensions, the benchmark S&P/ASX 200 index climbed 0.44 per cent or 24.90 points to 5,716.20 at the close of trade. However, the index fell 0.3 per cent during the week.
"The 5,640 level is very important, it held the market for most of 2017. Again this week, when the market came under pressure, we saw the index plunge to that level and immediately recover back," said Michael McCarthy, chief market strategist at CMC Markets.
Referring to the index's jump of 0.9 per cent in the previous session after falling to 5,642.8 on Wednesday, Mr McCarthy added "a lot of traders are taking this as a technical signal that the likelihood that the market will rise is much higher because of that bounce off the board in the previous session".
Financials tacked on 1.1 per cent to underpin gains, with Westpac Banking Corp adding 1.4 per cent and Commonwealth Bank of Australia firming 1 per cent.
Going against the grain, energy stocks rose 0.5 per cent despite Brent Crude oil futures falling to their lowest level since December 2017 on concerns of oversupply.
Mr McCarthy attributed the gains to traders who were using steep falls in oil prices this week to buy cheapened stocks, adding "its traders playing on the idea that given the fall in oil prices, they're looking for exposure to a bounce."
Despite the bounce, energy stocks posted their biggest weekly loss since October end, off 3.8 per cent for the week.
Sector heavyweight Woodside Petroleum Ltd rose 0.8 per cent, while Origin Energy Ltd gained 0.6 per cent.
Meanwhile, healthcare stocks and materials, both of which heavily depend on China for their income, traded lower.
The Australian dollar, seen as a proxy for China-related trades, eased on Friday.
Drugmaker CSL Ltd fell 1.5 per cent, with the overall healthcare index closing 0.7 per cent lower.
Meanwhile, the metals and mining index slipped lower after Dalian iron ore for January fell 2.4 per cent.
Global miner BHP fell 0.7 per cent, while rival Rio Tinto Ltd shed 0.3 per cent
New Zealand's benchmark S&P/NZX 50 index was nearly flat, inching down 0.02 per cent or 1.78 points to finish the session at 8,701.38.
Dairy firm a2 Milk Co Ltd gained 0.3 per cent, while Fonterra Shareholders' Fund fell 0.6 per cent.
REUTERS
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