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ASX closes higher on banks, energy gains

Australian shares have ended the week higher thanks to gains in financials and energy stocks, even as Friday's session was buffeted by an earlier slide in the Chinese yuan and concerns over escalating global trade tensions.

The benchmark S&P/ASX 200 index closed up 23.2 points, or 0.37 per cent to 6,285.9 points, while the All Ordinaries index finished the day 22.4 points, or 0.35 per cent, higher at 6,377.4 points.

The S&P/ASX200 finished the week 0.3 per cent higher and is again nearing a new 10-year closing high, after touching above 6,286 points earlier in the month.

A volatile day of trade for the yuan stoked fears that Beijing's currency management could become the next flash point in the trade dispute with the United States.

The Chinese currency managed to bounce in afternoon trade on suspected selling of dollars by state-owned banks.

Investors are keeping a wary eye on the European Union as it readies a set of retaliatory tariffs on US imports. Officials from the EU Trade Commission are due to arrive in Washington next week for trade talks.

"We are seeing our banks being bought as a safety trade coming out of global Asian markets and that's a dominating factor that's supporting our market at this point," said Mathan Somasundaram, a Blue Ocean Equities market portfolio strategist.

Financials, comprising of the benchmark's top constituents, drove the index higher, with Commonwealth Bank up 0.7 per cent at $75.90.

The Australian market has been fairly resilient in the face of intensifying global trade tensions, and has risen over the last few months even as many regional markets took a hit.

Commodity prices came under pressure overnight from fund selling amid concerns the trade dispute between the United States and China will spillover into lower demand for metals.

Bearing the brunt of the weakness in prices, the mining index slid 1.5 per cent, with BHP the biggest drag, falling 2.1 per cent to $32.91.

Gold prices slipped for a sixth session and hovered near a one-year low, as a stronger dollar and rising US interest rates pull investors away from the traditional safe-heaven.

Saracen Mineral Holdings and Northern Star Resources led the losses on Friday, down 3.9 per cent and 1.2 per cent, to $1.99 and $6.86 respectively.

At 1700 AEST the Aussie dollar was at 73.71 US cents, from 73.98 US cents on Thursday, losing ground as investors sold the local unit down on worries about US-China trade tensions and any resultant impact on Chinese economic growth.

ON THE ASX

* The benchmark S&P/ASX 200 index closed up 23.2 points, or 0.4 per cent, at 6,285.9 points

* The broader All Ordinaries index was up 22.4 points, or 0.4 per cent, at 6,377.4 points

* The SPI200 futures contract was up 13 points, or 0.2 per cent, at 6,225 points

CURRENCY SNAPSHOT AT 1700 AEST:

One Australian dollar buys:

* 73.71 US cents, from 73.98 US cents on Wednesday

* 82.81 Japanese yen, from 83.48

* 63.23 euro cents, from 63.66

* 56.59 British pence, from 56.71

* 109.06 NZ cents, from 109.35

GOLD:

The spot price of gold in Sydney at 1700 AEST was $US1,224.36 per fine ounce, from $US1,223.72 per fine ounce on Thursday.

Austrlaian Associated PressBack to Breaking News

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