The Australian stock market was slightly stronger at Friday noon, with gains in banking stocks offsetting losses in the resource sector.

At 1205 AEST, the benchmark S&P/ASX200 index climbed 0.12 per cent to 4,587.8 points. The broader All Ordinaries index went up 0.08 per cent to 4,625.1 points.

On the Sydney Futures Exchange, the September share price index contract gained six points at 4588 on a volume of 16,994 contracts.

Among the sectors, telecoms performed best, rising 0.66 per cent, followed by financials and consumer discretionary, which had added 0.31 and 0.18 per cent. Health and energy were worst off in the red, losing 0.94 and 0.42 per cent respectively.

Airlines moved during the day, as the Australian competition regulator said it was likely to block Virgin Blue's planned alliance with Air New Zealand.

Virgin Blue fell 9.3 per cent to 39 cents while Air New Zealand remained flat at $1.02. Rival carrier Qantas went up 1.96 per cent to $2.60.

The big four banks had all posted gains, with Commonwealth Bank up 34 cents at $52.83, Westpac rising 21 cents to $23.19, ANZ up 18 cents at $23.94 and National Australia Bank three cents firmer at $24.87.

Investment bank Macquarie Group had increased 7 cents to $34.69.

Among the miners, market heavyweight BHP Billiton edged 0.2 per cent higher to $38.26, Rio Tinto lifted 0.13 per cent to $74, while Fortescue Metals Group gave off 1.01 per cent to $4.87.

Burrell Stockbroking adviser Daniel Manley said he did not expect the market to rise much more during the day.

''The majority of the strength is coming through the financial sector, with the majority of the resources companies flat to weaker in the face of some ordinary base metals prices and a drop in the oil price overnight.''

''We are seeing a little bit of steam coming out of the gold sector, which has been incredibly strong over the past week and a half," Mr Manley said.

''It will be hard to see the market strengthening into the afternoon, being a Friday.''