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Aust stocks lift as trade sentiment turns

James Hall
The ASX finished higher on Friday and posted a gain for the week

Australian shares have finished higher on Friday, buoyed by improving global sentiment around trade, solid Chinese economic data and a bout of local buying by bargain hunters.

The benchmark S&P/ASX200 index closed 36.6 points, or 0.6 per cent, higher at 6,165.3 points on Friday, while the broader All Ordinaries index was up 36.4 points, or 0.58 per cent, at 6,276.3 points.

For the week - which also marks the 10th anniversary of the GFC - the benchmark index lifted 0.35 per cent.

Pepperstone head of research Chris Weston said signs of constructive dialogue between the US and China had led to investor confidence in Asia, where almost all markets were higher on Friday.

"You're seeing a lot of that bearish, negative sentiment being unwound and we're feeding off some of that optimism," he said.

The benchmark has lost 2.4 per cent since the beginning of September and had fallen for ten of the previous twelve sessions as trade war fears frayed nerves.

The Australian dollar remains around 72 US cents but had its best week since January on the back of positive results on the share market combined with the strong August jobs report on Thursday and the easing in US-China trade tension.

It got a lift overnight when Turkey's central bank hiked interest rates, boosting the lira and concerns about emerging markets to prompt some short covering in the Aussie, which has been sold as a hedge against such risks.

The Aussie was buying 72.06 US cents at 1700 AEST, from 71.87 on Thursday.

Dalian iron ore climbed three per cent on Thursday in reaction to the lower trade worries, lifting the materials sector on the ASX.

BHP was 1.6 per cent higher at $31.82, while Rio Tinto was up 1.2 per cent to $73.15.

The financial sector closed half a per cent higher as banks recovered from a tumultuous week affected by the latest hearings of the banking royal commission, with Westpac the strongest mover, up 0.7 per cent to $27.76, while NAB was the weakest, up 0.2 per cent to $27.35.

ANZ found itself the target of civil penalty proceedings from ASIC over allegations the bank breached its continuous disclosure obligations during a 2015 capital raising.

ASIC alleges that ANZ, which has already been charged with criminal cartel offences related to the raising, should have advised the market that the investment banks involved in the deal took up nearly a third of the shares in the placement.

ON THE ASX:

* The S&P/ASX200 closed up 36.6 points, or 0.6 per cent, at 6,165.3 points

* The All Ordinaries was 36.4 points, or 0.58 per cent, higher at 6,276.3 points

* In futures trading the SPI200 futures index was up 43 points, or 0.7 per cent, at 6,174.0 points at 1630 AEST.

CURRENCY SNAPSHOT AT 1700 AEST:

One Australian dollar buys:

* 72.06 US cents, from 71.87 US cents on Thursday.

* 80.64 Japanese yen, from 80.10

* 61.56 euro cents, from 61.83

* 54.94 British pence, from 55.12

* 109.41 NZ cents, from 109.65

GOLD:

The spot price of gold in Sydney at 1700 AEST was $US1,205.929 per fine ounce, from $US1,204.45 per fine ounce on Thursday.