April 26, 2013 / 6:56 AM / 7 years ago

Australian shares take breather, market posts biggest weekly gain since Dec 2011

(Adds details, comments)

SYDNEY, April 26 (Reuters) - Australian shares reversed earlier gains to finish the session 0.1 percent lower on Friday as the financial sector took a breather from a recent rally, offsetting advances made by miners on the back of strong metals prices.

Despite the modest loss on the day, the market posted its biggest weekly gain in well over a year as investors bought beaten down stocks and dividend yield plays such as banks.

The financial sector, however, attracted sellers heading into the weekend.

“The earlier buying momentum dried up,” said Tim Waterer, senior trader at CMC Markets.

“The pattern of trading today suggests there was perhaps some reluctance to take new positions into the weekend, particularly ahead of the U.S. GDP release.”

The S&P/ASX 200 index slipped 4.9 points to finish at 5,097.5, according to the latest data. The benchmark closed the week 3.4 percent higher, its biggest weekly jump since December 2011. U.S. stocks rose on Thursday, lifted by stronger-than-expected earnings and a large drop in weekly jobless claims

The Australian market had rallied 1.7 on Wednesday to finish at a 5-week high. Trading was closed on Thursday for the ANZAC day public holiday in Australia and New Zealand.

Blue chip miners BHP Billiton Ltd and Rio Tinto Ltd rallied 2.8 percent and 2.1 percent respectively.

Copper rose to a one-week high on Thursday on signs of industry restocking in top consumer China, while gold surged 2.5 percent as physical buyers scooped up the metal at prices viewed as a bargain after bullion hit a two-year low on April 15.

Gold miners were firmer on the day. Newcrest Mining Ltd jumped 3.6 percent while Regis Resources Ltd surged 11 percent. Small cap gold miner Tanami Gold rebounded 59.1 percent to A$0.105 from its recent rout earlier in the week. The goldminer put its West Australian Coyote mine on hold following the sharp drop in the price of gold.

Financials retreated from earlier advances to finish the session lower. Top lender the Commonwealth Bank of Australia and National Australia Bank lost 1.2 percent and 0.4 percent, respectively. Westpac Banking Corp bucked the trend, edging up 0.2 percent.

“Today we’ve seen banks selling, pretty much everything that’s gone up for the past couple of months is selling today,” said Damien Boey, equity strategist at Credit Suisse.

“The reason for that is that people are looking at the banks and all of these yield plays and they’re thinking that they’re getting too expensive.”

Australia’s GrainCorp Ltd jumped 7.9 percent after the company agreed on Friday to a revised A$3.0 billion ($3.1 billion) bid from U.S.-based Archer Daniels Midland Co, ceding control of Australia’s largest independent grains handler after a six-month courtship.

Shares in Australia’s Discovery Metals Ltd were suspended after its managing director said the company has received no new bid from former suitor Cathay Fortune, and said the Chinese firm’s disparaging comments this week were part of an effort to snap up its Botswana copper project cheaply.

New Zealand’s benchmark NZX 50 index added 0.2 percent or 9.7 points to a record closing high of 4,548.7. (Reporting by Thuy Ong; Editing by Shri Navaratnam)

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