Australian stocks inch higher on mining sector strength

The Australian stock market closed marginally higher on low trading volumes after gains by mining giant BHP Billiton offset weaker performances by the banks.

The benchmark S&P/ASX200 index was up 6.5 points, or 0.14 per cent, at 4,778.4 points, while the broader All Ordinaries index lifted 7.1 points, or 0.15 per cent, to 4,869.6 points.

On the ASX 24, the March share price index futures contract was 10 points higher at 4,776 points, with 12,169 contracts traded.

BHP Billiton was up 40 cents, or 0.88 per cent, at $45.82 while Rio Tinto put on eight cents to $86.78.

Westpac was down 10 cents at $22.6, ANZ fell seven cents to $23.63, National Australia Bank was 16 cents cheaper at $24.05 and Commonwealth Bank backtracked 13 cents to $50.87.

The corporate regulator says it has begun legal proceedings against Commonwealth Bank, Bank of Queensland and Macquarie Group over the collapse of Storm Financial.

Shares in Macquarie Group were up 22 cents at $37.22 while Bank of Queensland shares inched one cent higher to $10.54.

In other headlines on Wednesday, Telstra said its negotiations on the national broadband network with the federal government would take longer than it previously expected.

Shares in the telco were steady at $2.77.

Fashion retailer Noni B said it expected net profit for the first half of 2010/11 to be down from the prior corresponding period after like for like store sales fell 2.5 per cent.

Noni B shares shed seven cents, or 6.14 per cent, to $1.07.

Among other retail stocks, Woolworths put on nine cents to $26.80, Coles owner Wesfarmers gained 16 cents to $32.18 and JB Hi-Fi eased four cents to $17.85.

In the energy sector, Woodside was four cents softer at $42.78 and Santos gave up six cents to $13.56.

The spot price of gold in Sydney was $1,388.70 per fine ounce, up $2.47 from Tuesday's local close of $1,386.23 per fine ounce.

Gold producer Newcrest was 11 cents weaker at $40.23.

The best performing stock in the S&P/ASX 100 index was rare earths explorer Lynas Corporation after it said it had received approval from the Malawi government to acquire a rare earths resource for $US4 million.

Lynas shares finished up seven cents, or 4.4 per cent, at $1.66.

The worst performing stock on the S&P/ASX 100 index was online job ads company Seek, down 20 cents, or 2.96 per cent, at $6.56.

The top traded stock by volume was iron ore explorer Sundance Resources with 53.58 million shares worth $26.54 million changing hands.