Australia shares inch up, CBA reaches record high

Sun Jan 6, 2013 7:41pm EST

(Adds details, comments, stocks on the move)
    SYDNEY, Jan 7 (Reuters) - Australian shares inched up 0.1
percent on Monday, led by banking stocks, with investor
sentiment was buoyed by U.S. data showing a steady pace of jobs
growth and brisk expansion in the services sector.
    Banks were mostly strong, with Westpac Banking Corporation
 leading gains, rising 0.5 percent. The Commonwealth
Bank of Australia dropped 0.4 percent after hitting an all time
high of A$63.70.
    "People would be taking profit, reaching an all-time high of
that magnitude tends to mean people will cash that in," said
Evan Lucas, market strategist at IG Markets.
    "They've certainly reached a high resistance level of A$63
which they got to about 10 minutes after trade opened and since
then have been trading down with pretty strong volumes."
    Defensives were also strong with blood products maker CSL
Ltd up 0.2 percent and multisector retailer Wesfarmers
 adding 0.4 percent.
    The S&P/ASX 200 index was 5.7 points higher at
4,729.5 by 0027 GMT. It fell 16.9 points on Friday after
reaching 19-month highs earlier in the week.
    "The official government unemployment data release actually
showed the U.S. labour market is slowly but surely healing
itself," said Lucas.
    "The U.S. market quite liked that and they moved up quite
strongly on Friday night's trade and we're following suit."
    Miners were were weak, BHP Billtion Ltd lost 0.4
percent while rival Rio Tinto Ltd dropped 0.9 percent.
The top iron ore miner is considering the suspension of
operations in the Northern Territory after talks with the
government over power supplies to the plant broke down last
month.
    Iron ore climbed to its highest in more than a year at
around $150 a tonne on Friday, with Chinese mills continuing to
replenish inventories as recent economic data fuelled hopes of
better demand in the new year. 
    The U.S. Labor Department said non-farm payrolls grew by
155,000 jobs last month, slightly below November's level. Gains
were distributed broadly throughout the economy, from
manufacturing and construction to healthcare.
    New Zealand's benchmark NZX 50 index rose 0.3
percent to 4,085.8.

    STOCKS ON THE MOVE
    * Lynas Corp Ltd jumped 8 percent after it said it
expects to begin commercial production at its rare earths plant
in Malaysia in the next few weeks, with a ramp up in production
to take place over the next three months.
    (0026 GMT)
    

 (Reporting By Thuy Ong; Editing by Eric Meijer)