The Australian share market finished up slightly on Friday, in choppy trading as investors kept a wary eye on developments in US-Chinese trade talks.
The benchmark S&P/ASX200 index closed up 15.6 points, or 0.25 per cent, to 6,310.9 points, while the broader All Ordinaries finished up 15.8 points, or 0.25 per cent, to 6,393.1.
Overall the ASX200 finished the week down 0.39 per cent, its second straight losing week.
While the US more than doubled tariffs on China at 2pm AEST, traders saw that as a negotiating tactic in their ongoing trade dispute. High-level officials were still meeting Washington trying to salvage a deal.
All sectors on the ASX were higher except for miners were flat, with the defensive utilities sector leading the way, collectively up over two per cent.
Spark Infrastructure was up 3.64 per cent to $2.28, AGL Energy was up 2.14 per cent to $22.96 and Infigen Energy was up 4.6 per cent to 45.5 cents.
BHP was down 0.49 per cent to $36.80 while Fortescue Metals gained 1.07 per cent to $7.54.
Three of the big four banks gained, with Commonwealth up 0.31 per cent to $75.40, NAB up 0.12 per cent to $25.94, and Westpac up 0.59 per cent to $27.22. ANZ fell 0.54 per cent to $27.50.
News Corp's ASX-listed shares gained 1.03 per cent to $16.75 after the media giant posted $US23 million ($A32.9m) net income for the third quarter, with the consolidation of Foxtel and a strong performance by HarperCollins offsetting a decline in news and information earnings.
REA Group shares were up 0.91 per cent to $81.88 after the realestate.com.au operator said its third-quarter revenue rose seven per cent to $198.6 million as it increased fees to make up for a drop in listings.
Infratil shares were placed in a trading halt after the New Zealand infrastructure company prepared to make an announcement about the potential acquisition of Vodafone NZ.
Synlait Milk shares dropped 4.06 per cent to $9.46 after the New Zealand dairy company said a court ruling would complicate its plans to open a second nutritional powder manufacturing plant on land in Pokeno.
The Court of Appeals re-imposed covenants on the land restricting its use to grazing and forestry, meaning near-complete factory is in breach of the restrictions.
The Aussie dollar is buying 69.94 US cents, from 69.78 US cents on Thursday.
This week, Commonwealth Bank will give its third quarter trading update on Monday, while Xero will announce its full-year results on Thursday.
Three of the four big banks go ex-dividend in May which may put some pressure on the market.
Stock valuations have climbed to levels reached just before Wall Street's late 2018 plunge, leaving the market at risk of shocks such as the sell-off this week as global trade tensions mount.
But stocks may have more support than last year, due largely to lower bond yields and a more dovish outlook on interest rates from the Federal Reserve.
Under the traditional price-to-earnings (P/E) ratio method of valuing equities, stocks recently rose to their most expensive level since September. The benchmark S&P 500 index peaked last year on 20 September, before sliding nearly 20 per cent over the next three months.
The forward P/E for the index, which compares stock prices to estimated earnings over the next year, had climbed recently to 17 times, making the index about 13 per cent more expensive than its historic average, according to more than 30 years of data tracked by Refinitiv.
After the S&P 500 hit record highs last week, Trump spooked stocks by threatening over the weekend to raise tariffs on Chinese imports. This ratcheted up tensions in the long-running trade dispute between the world's two largest economies. Investors who had been optimistic about a US-China deal now fear such a deal may not happen anytime soon.
The S&P fell early on Friday but finished slightly higher after remarks from Trump and other officials fed hopes that Washington and Beijing would avoid the worst-case scenario of a complete breakdown in negotiations.
The Dow Jones Industrial Average on Thursday rose 114 points, or 0.44 per cent, to 25,942.37; the S&P 500 gained 10.68 points, or 0.37 per cent, to 2,881.40; and the Nasdaq Composite rose 6.35 points, or 0.08 per cent, to 7,916.94.
As of Friday's close, the S&P 500 was about 2.2 per cent below its all-time high close, which in turn reduced the forward P/E multiple on the S&P 500 to nearly 16.8 times, still well above the historic average of 15.1 times. On Friday, the S&P 500 rose 0.4 per cent.
Debate about valuations has taken hold broadly. Just this week, the Fed called stock prices "elevated" in its latest financial stability report.
Stocks may have a cushion, however, with lower interest rates, which help the allure of stocks.
The yield on the benchmark 10-year US Treasury note sits at 2.46 per cent, after eclipsing 3.2 per cent in November, making bonds look less competitive as an investment versus equities. Stocks are typically valued through by estimating their future cash flows, which are more valuable at lower rates.
The Fed, meanwhile, has signaled little appetite to adjust rates any time soon. As recently as December, the Fed had anticipated further rises in borrowing costs in 2019.