By Sindhu Chandrasekaran
June 23 (Reuters) - Australian shares were flat on Friday with financial stocks falling after an Australian state imposed a surprise tax on the country's five biggest banks, while gains in materials and healthcare stocks kept the index afloat.
The S&P/ASX 200 index .AXJO rose 0.02 percent or 0.55 points to 5,706.50 by 0344 GMT. The benchmark closed 0.7 percent higher on Thursday.
Financials .AXFJ fell 0.8 percent with three of the "Big Four" banks each falling 0.9 percent, while Westpac Banking Corp WBC.AX gained marginally.
South Australia imposed a surprise tax on Australia's five biggest banks on Thursday, which came after a new $4.6 billion federal levy. banks are likely to push back against the South Australian government's bank levy as they will not want the other states to follow SA's lead," UBS said in a note.
"We remain cautious on the outlook for the banks given the myriad of headwinds."
Among other stocks, miners .AXMM were trading higher on the back of gains in commodity prices.
Oil rose on Thursday after hitting 10-month lows in the previous session, while gold prices rose for a second straight day as weaker oil prices drove up demand for the yellow metal. O/R GOL/
BHP Billiton (LON:BLT) Ltd BHP.AX rose 1 percent while Rio Tinto (LON:RIO) Ltd RIO.AX climbed 0.7 percent.
Global miner Rio Tinto announced completion of a planned bond buy-back, reducing its gross debt by $2.5 billion. sands explorer Iluka Resources Ltd ILU.AX rose as much as 6.1 percent and was the fourth biggest gainer on the index. Credit Suisse (SIX:CSGN) upgraded the stock and said the company's decision to restart Jacinth-Ambrosia mine bolsters confidence. gains in healthcare stocks .AXHJ , which hit a record high, helped counter the drag from financials.
The healthcare index rose as much as 0.9 percent, mirroring its U.S. peers which jumped after U.S. Senate leaders unveiled a draft of legislation to replace Obamacare. Ltd CSL.AX topped gainers after the U.S. Food and Drug Administration approved its therapy for prevention of hereditary angioedema attacks. Zealand's benchmark S&P/NZX 50 index .NZ50 dropped 0.2 percent, or 18.07 points, to 7,545.62.
Utilities and telecom stocks led losses with Meridian Energy Ltd MEL.NZ and Spark New Zealand Ltd SPK.NZ falling 1.2 and 1.1 percent, respectively.
New Zealand's central bank on Thursday played down the recent rise in the kiwi dollar shrugging off weaker economic growth at the start of the year, as it kept interest rates steady at record lows for a fourth consecutive rate review. more individual stocks activity click on STXBZ