Australian shares closed 0.4 percent lower on Friday, dragged down by a sell-off in cyclical stocks as investors took profits from a recent rally. The market still ended the week 1.4 percent higher, and it has gained 9.4 percent this year thanks to reduced concern over the global economy. A strong earnings season has also encouraged investors. "The fundamentals look supportive of the Australian share market overall," said CMC Markets chief market strategist Michael McCarthy in Sydney.
Noting that traders were looking for a "healthy correction", McCarthy said it's not uncommon to see a significant pull-back before the market goes higher later. Resource stocks were hit the most on Friday, with BHP Billiton Ltd down 0.6 percent and Rio Tinto Ltd 1.5 percent lower. The benchmark S&P/ASX 200 index lost 18.0 points to 5,086.1, according to the latest data. It jumped 1.3 percent on Thursday to its highest close since September 2008.
China, Australia's biggest resources buyer, said on Friday its official purchasing managers' index (PMI) for February was at its slowest pace in months at 50.1, slightly below a 50.2 Reuters poll consensus and the 50.4 posted in January. Most big banks managed to hold the ground, led by a 0.9 percent gain in Commonwealth Bank of Australia. Australia and New Zealand Banking Group dipped 0.4 percent. Defensive stocks were weaker, with the country's flagship telecom company Telstra Corp Ltd dropping 1.3 percent.
Television group Ten Network Holdings Ltd soared 9.1 percent to a six-month high, after media reported rival Seven Group Holdings Ltd 's boss Kerry Stokes had built up a A$40 million stake in it. New Zealand's benchmark NZX 50 index slipped 2.0 points lower to 4,318.0.
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