The share market has closed higher as weaker than expected figures on home lending renewed expectations of an interest rate cut.

An overheating housing market was considered a hindrance to another rate cut by the Reserve Bank, due to concerns it could fuel excessive borrowing.

But February home loan figures may indicate the housing market is not as strong as thought, IG market strategist Stan Shamu said.

“I think everyone is feeling that this is probably positive from a rate cut perspective,” he said.

“It probably means that the RBA doesn’t have to be too concerned about the housing market.”

The value of total housing finance fell 1.0 per cent in February, with a 3.4 per cent fall in approvals for investment housing.

Renewed expectations of an interest rate cut helped pushed shares in the major banks higher, along with other stocks offering good dividend yields, Mr Shamu said.

Commonwealth Bank rose 28 cents to $94.13, National Australia Bank lifted 14 cents to $39.52, Westpac improved 36 cents to $39.88 and ANZ increased 18 cents to $36.80.

The major retailers also lifted, with Woolworths up 51 cents at $29.56 and Wesfarmers gaining 68 cents to $44.40.

BHP Billiton fell five cents to $30.14, Rio Tinto added 31 cents to $56.89 and Fortescue Metals dropped 7.5 cents to $1.815.

Oil and gas producer Woodside Petroleum put on 77 cents to $34.90 and Santos gained 15 cents to $7.52 as oil prices rebounded.

Telstra nudged one cent higher to $6.28.

KEY FACTS

* At 1615 AEST on Friday, the benchmark S&P/ASX200 index was up 36.2 points, or 0.61 per cent, at 5,968.4 points, according to preliminary closing figures.

* The broader All Ordinaries index was up 33.9 points, or 0.57 per cent, at 5,935.4 points.

* The June share price index futures contract was up 25 points at 5,960 points, with 16,027 contracts traded.

* National turnover was 1.25 billion securities worth $3.2 billion.