(Adds analysis, quotes, stocks on the move)
SYDNEY, Feb 7 (Reuters) - Australian shares rose 0.4 percent on Friday, lifted by big banks and miners, as investors awaited U.S. payroll numbers and local corporate earnings.
Miners BHP Billiton Ltd and Rio Tinto Ltd gained 1.4 percent and 0.4 percent, respectively.
Commonwealth Bank of Australia edged up slightly, and Westpac Banking Corp climbed 1.5 percent.
The S&P/ASX 200 index added 21.2 points to 5,152.6 by 0121 GMT. The benchmark rose 1.2 percent on Thursday, its biggest one-day gain in three weeks.
"Obviously it all hinges on the non-farm payrolls tonight in the US. The market is pretty bullish," said Simon Ho, executive director at Triple 3 Partners, an independent investment firm.
"We're not as sanguine about it, we still think there are some worries out there, emerging markets for one," Ho added.
China's markets reopened on Friday after the week-long lunar new year holiday, and analysts expect a correction ahead for the ASX from potentially downbeat Chinese data down the track.
"The holidays are also likely to feed into retrospective data over the coming months and will give the China bears even more fodder," IG market strategist Evan Lucas said in a client note.
Australia's central bank on Friday raised its forecasts for economic growth and inflation for 2014, and reiterated that rates were likely to remain at 2.5 percent for a while, in part because underlying inflation was now expected to near the top of its target band by mid-year.
Aurora Oil & Gas Ltd surged 56 percent to a 15-month high after Canadian heavy oil producer Baytex Energy Corp agreed to buy the company at A$4.10 per share, adding to its production from the prolific Eagle Ford shale oil region of Texas.
The Aurora deal boosted other energy producers such as AWE Ltd, jumping 7.2 percent, and Karoon Gas Australia Ltd , up 6.3 percent.
Woodside Petroleum Ltd, however, eased 0.5 percent after it signed a memorandum of understanding to acquire a 25 percent interest in Israel's Leviathan field, which is smaller than the previous in-principle agreement to buy a 30 percent stake in the newly discovered gas prospect.
Billabong International Ltd Jumped 12.4 percent, after it said it was considering a sale of its two e-commerce businesses to refocus on its core brand.
New Zealand's benchmark NZX 50 index rose 0.6 percent to 4,835.5.
Reporting by Maggie Lu Yueyang; Additional reporting by Thuy Ong; Editing by Eric Meijer