Australian shares eked out a gain of 0.1 percent to touch an 8-month closing high on Friday, proving resilient to worries about global economic growth that have hurt US markets, as investors looked ahead to a possible cut in official interest rates. Key inflation data next week could pave the way for a rate cut by the Reserve Bank of Australia when it next meets on May 1.
"The Australian share market has been holding up better lately and if the RBA cuts rates and confidence regarding a Chinese soft landing builds then the local market could be in for a period of relative outperformance," said AMP head of investment strategy Shane Oliver.
The benchmark S&P/ASX 200 index ended up 3.8 points at 4,366.5 after trading weaker for most of the session in a tight 15-point range. It was the highest close since August 2. For the week, the local market gained 1.0 percent. New Zealand's benchmark NZX 50 index fell 0.3 percent to 3,516.2.
The building materials sector was softer on worries about profits, after Boral Ltd cut its full-year guidance because poor weather was continuing to interfere with house building activity. Boral shares lost 2.9 percent while James Hardie fell 1.1 percent. Copper miner Ivanhoe Australia shares dropped 4.9 percent after a report that majority shareholder Rio Tinto has held talks about divesting its 59 percent stake.
Pharmaxis Ltd jumped 6.1 percent to A$1.30 after the biotech company received approval to market its cystic fibrosis drug Bronchitol in Europe, and said stocks would be available for sale by mid-May. When European regulators reversed a negative ruling on the drug last October, the company's shares surged 65 percent. Woolworths Ltd, Australia's top supermarket chain, closed up 0.1 percent.
It had earlier fallen 1.2 percent after posting the weakest growth in same-store food and liquor sales in at least a decade in the third quarter, with flat sales missing market forecasts for a 0.5 percent rise. "The rate of growth in its largest division has gone from 9 percent three years ago, to zero growth now. And its major competitor is only ramping up its war on prices, so as an investment it is going to be hard to generate returns," said City Index analyst Peter Esho. Rival Wesfarmers Ltd, owner of Coles, was up 0.4 percent, while other retailers were weaker, including David Jones which was down 1.2 percent.
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