Australia shares up as investors seek bargains, China PMI survey caps gains

Mon Mar 24, 2014 1:23am EDT

(Updates to close)

SYDNEY, March 24 (Reuters) - Australian shares reversed early losses to rise 0.2 percent on Monday as investors piled into cheaper banks and resource stocks, though gains were capped as a manufacturing PMI survey for China showed reduced activity for March.

Activity in China's factories shrank again in March as output and new orders both weakened, a preliminary private survey showed. The flash Markit/HSBC Purchasing Managers' Index fell to an eight-month low of 48.1 in March from February's final reading of 48.5.

The S&P/ASX 200 index added 8.8 points to 5,346.9 at the close of trade. The benchmark bounced 0.8 percent on Friday and added 0.2 percent last week.

New Zealand's benchmark NZX 50 index slipped 0.1 percent to 5,118.6. (Reporting by Thuy Ong; Editing by Richard Borsuk)