SYDNEY/WELLINGTON, April 28 (Reuters) - Australian shares edged up 0.6 percent on Thursday as firmer oil prices buoyed the energy sector and a billion-dollar takeover bid for clothing company Pacific Brands stirred speculation of more merger activity.
The S&P/ASX 200 index (xjo) rose 29.89 points to 5,217.6 by 0355 GMT. The gains largely reversed losses suffered on Wednesday and still left the index 0.4 percent lower for the week so far.
Sentiment was supported by talk the Reserve Bank of Australia (RBA) could cut interest rates to a record low of 1.75 percent next week following Wednesday's surprisingly low reading on inflation.
Pacific Brands Ltd (PBG) was easily the best performer, jumping 23 percent to its highest since late 2010 after agreeing to an all-cash buyout offer from U.S. clothes giant HanesBrands Inc
. The offer values Pacific Brands at A$1.1 billion ($836 million).
Shares in Australian oil companies got a lift after oil climbed on Wednesday while some major producers beat gloomy expectations. Woodside Petroleum Ltd (WPL) added 2.1 percent and Santos Ltd (STO) 2.3 percent.
The mood brightened overnight when BP
posted an 80 percent drop in first quarter profits but still beat market forecasts and maintained its dividend. New Zealand's benchmark S&P/NZX 50 index (nz50) added 0.3 percent or 18.9 points to 6789.3.
The market was restrained by the Reserve Bank of New Zealand's decision to skip a chance to cut interest rates on Thursday, though it did say further easing might be needed in coming months.
