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Australia: Shares up as Wesfarmers jumps on spin-off plans; NZ slips

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[BENGALURU] Australian shares rose on Friday, boosted by retail giant Wesfarmers which soared after announcing plans to spin off its Coles supermarket division, but falls in banking stocks limited gains.

The S&P/ASX 200 index rose 0.3 per cent or 14.6 points to 5,935.4 by 0031 GMT, but was set to finish the week lower. The benchmark fell 0.2 per cent on Thursday.

Investors rushed to buy Wesfarmers' stock after it announced plans to spin off its Coles supermarket chain and list it on the Australian Securities Exchange, sending shares up as much as 6 per cent - its biggest intraday surge in over eight years.

Rival Woolworths rose as much as 2 per cent.

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Materials stocks added to the gains on the index, riding on strong metal prices, with top miners BHP Billiton and Rio Tinto up 1.2 per cent and 1.1 per cent, respectively.

South32 rose as much as 3.6 per cent after Credit Suisse upgraded the stock to "neutral" from"underperform".

Fashion retailer Premier Investments was the top gainer on the index, up as much as 7.5 per cent to its highest since Oct 2016 after reporting a 9.4 per cent climb in first-half profit.

"(The gains) are relatively short-term at the moment because markets are looking forward to what's going to happen next week with the US Federal Reserve, and when you're at stretch valuations that's probably a negative," said Mathan Somasundaram, market portfolio strategist at Blue Ocean Equities.

The US central bank is expected to raise interest rates for the first time this year at the Federal Open Market Committee meeting next week.

Financial stocks capped the gains on the index, with the index down for a fourth straight session amid a government backed inquiry into the sector.

The "Big Four" banks fell 0.5 and 0.9 per cent. The hearing on Thursday revealed Commonwealth Bank of Australia knew that a system of financial incentives to reward mortgage brokers could hurt customers but failed to act.

New Zealand's benchmark S&P/NZX 50 index reversed early losses to rise as much as 0.2 per cent, and is set to end the week up about 1.1 per cent.

Fisher & Paykel Healthcare Corporation Ltd was the biggest contributor to the index, rising as much as 1.8 per cent, while construction firm Fletcher Building Ltd climbed 2.3 per cent.

REUTERS