SYDNEY (Dow Jones)--Australian shares eked out a modest 0.2% gain on Thursday, led by a recovery in banks following a lackluster session on Wall Street and a dearth of local corporate news to inspire much trade. Investors grappling for catalysts may turn their attention to U.S weekly jobless claims data released later today, MF Global Senior Trader Anthony Anderson said. The benchmark S&P/ASX 200 index staged a late recovery after dipping in the middle of the session to end up 10.2 points at 4749.2, after earlier touching 4761.3. "The banks have been really weak of late--there's been a lot of talk of them being fully valued--but they've turned around today," Anderson said, adding that gold stocks also led the market higher on a continued surge in the price of the precious metal. Insurer IAG gained ground on lingering speculation of a bid by QBE Insurance and the general buzz in the sector generated by a recent takeover offer for AXA Asia Pacific. Market leader BHP Billiton staged a late recovery to rise 0.6% to A$40.85 while rival Rio Tinto closed flat at A$72.60. Commonwealth Bank picked up 1.5% and National Australia bank rose 1.1%. Gold miner Newcrest added 1.6% and insurer IAG rallied 5%. QBE fell 2%, AMP rose 1.3% and AXA Asia Pacific climbed 0.5%. On Wall Street, the Dow Jones Industrial Average fell 0.1% Wednesday on data showing a sharp decline in U.S home construction. Joseph Pagliaro, client advisor at Wilson HTM, said investors "are genuinely caught between being bullish and being flat". "It looks as though the market is going to consolidate for a little bit until we start to get some firmer positive direction out of the U.S," he said. Bell Potter Senior Client Adviser Stuart Smith is a little more bullish and noted that the occurrence Thursday of the monthly index options expiry day also contributed to flatness on the Australian market. "If you look back on every expiry day--we have one every jolly month--it seems to put a curve ball into things," he said. Smith said the market should be heading higher after news yesterday that the Westpac-Melbourne Institute leading index of the Australian economy grew at annualized rate of 5.8% in September, up from 3.8% in August--its fastest rebound since the 1970s. While the last few economic readings from the U.S. sapped energy from the Aussie bourse, conditions could improve by the end of the year, said IG Markets Research Analyst Ben Potter. "Given seasonal factors and the fact we're in an uptrend, you'd have to be bullish heading into Christmas," Potter said. Consumer staples group Goodman Fielder added 0.7% after revealing it is close to selling its fats and oils business to an unnamed buyer. Brambles gained 0.6% after the pallet company said sales for the four months ended Oct. 31 fell 3% from a year earlier to US$1.40 billion, with the biggest revenue fall experienced in its CHEP USA pallet business. -By Ross Kelly, Dow Jones Newswires; 61-2-8272-4692; ross.kelly@dowjones.com

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