The Australian share market ended the day up 0.3% Thursday after a quiet day when strength in the mining giants and a higher Australian dollar boosted stocks in the afternoon.

The overall S&P/ASX 200 was up 0.3% to 4837.9 at the end of the session.

Mining giant BHP Billiton (BHP.AU) was up 2% as speculation cooled that the Anglo-Australian miner was preparing to make a tilt at Woodside Petroleum, be it through acquiring a stake or making an outright bid for the company. Also, CMC market analyst Ben Le Brun says investors may be buying back into BHP given the shares may have been oversold on recent international events.

Citigroup downplayed the probability of BHP buying out Woodside in a research note downgrading Woodside to sell. Woodside shares fell 2% Thursday.

While project synergies would be available to touted suitor BHP, mainly around putting its gas through Woodside's Pluto LNG project in Western Australia, these would be worth no more than A$4 billion, the broker says.

"We don't think it would make sense for BHP to pay a near A$12 billion takeover premium to Woodside in this context, particularly given BHP could access some of these benefits through a third party supply deal," Citigroup says, adding that BHP trades at far more demanding levels than Woodside and that ongoing buybacks would represent a better investment for the miner."

Also overnight, BHP approved a $554 million project to expand Escondida, the world's largest copper mine. Fellow mining giant Rio Tinto was up 0.6%.

Another gainer in the market Thursday was telecom giant Telstra, which ended the day up 0.7% after legislation for Australia's proposed A$36 billion national broadband network was passed by lawmakers earlier in the week and the company indicated to Dow Jones Newswires it's examining expansion opportunities in China.

Other sectors like consumer staples and financials were not as strong on Thursday.

The banks were down most of the day but ended the afternoon mixed with Commonwealth Bank down 0.3%, National Australia Bank up 0.9%, Westpac up 0.3% and ANZ down 0.3%.

Australian retail sales data rose a higher-than-expected 0.5% to a seasonally adjusted A$20.53 billion in February, the Australian Bureau of Statistics said Thursday. Economists surveyed ahead of the announcement on average had expected a rise of 0.4%. Household goods retailing rose 2.0%, while sales of clothing and footwear rose 0.9% in February.

Retailers were mixed. Harvey Norman was up 0.3%; Myer Holdings was up 0.6% and David Jones was flat. Conglomerate and retailer Wesfarmers was down 1.7% while retail giant Woolworths was up 0.3%.

"We could be a little bit nervous again tomorrow," Frank Cerra, senior client adviser at Ord Minnett, said. "(The Australian dollar) jumped up with the retail sales better-than-expected. That certainly helped the market up a little bit in the afternoon."

Others see the afternoon's momentum continuing.

"I think the momentum is definitely on the upside, on the way we're definitely going to have our pullbacks," a trader at a local brokerage who wished to remain unnamed, said. "It's still going to be volatile but I think the trend's definitely on the up."

 
   -By Cynthia Koons; Dow Jones Newswires; +61-2-8272-4691; cynthia.koons@dowjones.com
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