Australia shares edge lower in choppy trade, miners drag
(Updates to close, adds analyst and dealer comment)
SYDNEY, June 28 (Reuters) - Australian shares closed down 0.2 percent in choppy trade on Friday, with miners dragging on the market, but ended the first half of the year 3.3 percent higher on buying inspired by a happier view of China's credit conditions.
Australian stocks have been hit hard in recent sessions, pulled down from a year-high of 5,249.6 points set on May 15 by concerns about the U.S. Federal Reserve's plans to curtail its stimulus and a cash crunch in China.
China's central bank sought to quell fears that a credit crunch could hobble economic activity, saying on Friday that authorities would ensure reasonable lending growth and stable markets.
The S&P/ASX 200 index lost 8.7 points to 4,802.6, but its weekly gain of 1.3 percent was the biggest in 1-1/2 months. The benchmark jumped 1.7 percent on Thursday.
It was a choppy day of trade, which saw some investors buying with improved confidence, but lingering doubts still held back some long positions, said analysts and dealers.
"Because it is the end of the (Australian financial) year, fund managers would like to see share prices higher than lower and give them a better number for the year," said Winston Sammut, investment director at Maxim Asset Management.
But overarching concerns over stimulus reduction and China's slower growth continued to weigh on market sentiment and pulled the index back to the red.
"There were concerns about the political instability, then investors will be looking to cut their positions particularly if the view is that the Aussie dollar is continuing to weaken," Sammut said.
Miners traded lower as gold fell below $1,200 to its lowest since August 2010 and copper eyed its biggest quarterly loss in almost two years.
BHP Billiton Ltd slid 0.3 percent and Fortescue Metals Group Ltd dropped 1.9 percent. Rio Tinto Ltd bucked the trend and rose 1.1 percent.
"Given that we still see quite a bit of volatility in commodities prices, traders are just cautious about extending long positions in material stocks," said Tim Waterer, a senior dealer at CMC Markets.
Financials were mostly stronger, with Westpac Banking Corp climbing 0.2 percent and Australia and New Zealand Banking Group adding 0.3 percent. Top lender Commonwealth Bank of Australia ended almost flat.
The country's biggest phone company, Telstra Corp Ltd , slipped 0.2 percent.
Caltex Australia Ltd plunged 11.8 percent to a near four-month low after it said late on Thursday that its half-year profit would be lower than the previous year's.
New Zealand's benchmark NZX 50 index rose 0.5 percent to 4,440.2. (Reporting by Maggie Lu Yueyang; Additional reporting by Thuy Ong; Editing by Eric Meijer)
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