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Australia shares pare early gains, China data awaited
(Adds details, comments, stocks on the move)
SYDNEY, March 21 (Reuters) - Australian shares trimmed early gains to rise 0.3 percent in midday trade on Thursday after the Federal Reserve reaffirmed its commitment to policy stimulus, as caution on Cyprus and uncertain demand in China undermined confidence.
Financial stocks led gains, with Westpac Banking Corp climbing 1.1 percent to be the best performing of the major banks.
The S&P/ASX 200 index was 14 points higher at 4,981.3 by 0021 GMT as investors remained cautious ahead of the HSBC Flash Manufacturing PMI due out from China later on Thursday. The benchmark fell 0.4 percent on Wednesday.
"The market behaviour has changed from an uptrend to a sideways trend," said Michael McCarthy, chief market strategist at CMC Markets.
The market is floating around 4,975 points, which has been a support level over the past few weeks, he said.
"Now although we did close below that level yesterday, we've flipped above it today. So at this stage we don't have a clear direction for the short term in the market," he said.
Blue chip iron ore miners were moderately firmer. BHP Billiton Ltd and Rio Tinto Ltd rose 0.8 percent and 0.9 percent respectively.
Iron ore prices could fall to around $90 a tonne by 2018 from an average of $128 in 2012, a result of moderating demand in China and supply increases, Australia's Bureau of Resources and Energy Economics said on Wednesday.
Oil miners traded higher as brent crude oil rose above $108 a barrel overnight, recovering from a three-month low. Woodside Petroleum added 1 percent and Santos inched up 0.4 percent.
Gold miners weighed on the market after bullion slipped on Wednesday in response to the U.S. Federal Reserve's latest policy statement repeating its accommodative stance and extending it for another two years. Newcrest Mining and Resolute Mining Ltd lost 1.6 percent and 1.7 percent respectively.
Defensives were mixed. Top communications provider Telstra rose 0.3 percent. Food retailer Woolworths Ltd inched up 0.2 percent while rival Wesfarmers dropped 1.1 percent. Energy provider AGL Energy fell 0.6 percent and blood products maker CSL Ltd was flat.
U.S. stocks climbed on Wednesday, with the S&P 500 snapping a three-day losing streak on the back of the Federal Reserve's remarks. The Fed said it would stick to its $85 billion monthly bond-buying stimulus, citing stubbornly high unemployment, but said it would take into account the possible risks of its policies.
New Zealand's benchmark NZX 50 index edged 0.2 percent or 9.8 points lower to 4,339.7.
STOCKS ON THE MOVE
* Trading in Australia's Sundance Resources Ltd was suspended after it said on Wednesday it was not confident suitor Hanlong Mining would meet a deadline to prove financing for its $1.4 billion takeover bid after the apparent detention of the Chinese company's chairman.
* Elders Ltd was trading flat at A$0.12 after the agribusiness company said on Wednesday it was in talks with a number of parties about the sale of its rural services business, responding to an announcement from Australia's competition watchdog that it was reviewing a proposal from Ruralco Holdings Ltd
(Reporting by Thuy Ong; Editing by Stephen Coates)
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