Australian shares have edged higher as gains by mining and chemical companies offset more falls by the major banks.

Options XPress market analyst Ben Le Brun said banking stocks had again failed to fire after recent dividend payments to investors.

“While there’s a bit of profit taking going on in that sector of the market, or perhaps a re-evaluation of the sector overall, that can take a few days to play out,” Mr Le Brun said.

Gains in the materials and energy sector were more modest than their early highs, fuelled by higher commodity prices.

“Most likely, if people are selling out they are crystalising some reasonable profits,” Mr Le Brun said.

BHP added 12 cents to $38.03, Rio Tinto dropped 37 cents to $64.70 and iron ore miner Fortescue Metals gained 17 cents to $5.61.

Fertiliser and explosives maker Incitec Pivot added 19 cents, or 7.3 per cent, to $2.80, as its full year profit of $372 million beat market expectations.

Fellow chemicals company Orica gained $1.79, or 8.2 per cent, to $23.60.

In the banking sector, Westpac dropped 27 cents to $32.85, ANZ lost three cents to $32.11, NAB shed six cents to $34.50 and Commonwealth Bank was 26 cents weaker at $78.09.

News Corp’s local shares dropped 62 cents, or 3.3 per cent, to $18.40 after it reported a first quarter profit of $US38 million ($A40.60 million).

Warrnambool Cheese and Butter added nine cents to $8.54 after the federal government gave its approval to Canadian food giant Saputo’s proposed takeover.

KEY FACTS

* At the close on Tuesday, the benchmark S&P/ASX200 index was up six points, or 0.11 per cent, at 5,393.1.

* The broader All Ordinaries index was up six points, or 0.11 per cent, at 5,386.8.

* The December share price index futures contract was nine points higher at 5,410, with 22,349 contracts traded.

* National turnover was 1.7 billion securities worth $3.8 billion.