* Financials only sector trading higher
* Gold stocks drop 3.2% as risk appetite improves
* ECB expected to cut rates later this week
By Nikhil Subba
Sept 9 (Reuters) - Australian shares rose marginally higher on Monday, lifted by gains in financials, while investors maintained a cautious stance amid expectations of likely stimulus boost from major central banks to shore up flagging economies.
The S&P/ASX 200 index .AXJO was up 0.12% at 6,655.50, as of 0241 GMT. The benchmark ended 0.9% higher on Friday.
The U.S. Fed last week said it would continue to act "as appropriate" to sustain the economic expansion in the world's biggest economy, which markets have read as an indication for further rate cuts ahead, apart from the one expected at next week's meeting. market confidence were expectations the European Central Bank (ECB) would also cut interest rates on Thursday in one of the week's key events.
There are heightened expectations that central banks around the world, including the Reserve Bank of Australia, will move to ease monetary policy to revive growth.
Global equities received a boost after China's central bank said it would lower the amount of cash that banks must hold as reserves, in order to bolster the nation's economy dogged by the Sino-U.S. trade conflict. mainly the rate cut view for the U.S. and Europe ... which is boosting our currency ... and the classic currency players tend to be the banks and so banks are up and because there are heavyweights in the index, the main benchmark is slightly positive", said Mathan Somasundaram, market portfolio strategist, Blue Ocean Equities.
Markets are going to hold in the current fashion for the rest of the week, waiting for the ECB to set the scene for a rate cut, Somasundaram added.
The "Big Four" lenders were trading higher, which helped the financial index .AXFJ climb 0.7%, single-handedly holding the main benchmark in positive territory.
Meanwhile, gold stocks slumped as much as 3.2%, as improved risk appetite, following the U.S. Fed's remarks on future rate cuts, sent traders away from safe-haven buying. overall mining index .AXMM slipped 0.8%, with industry heavyweights such as BHP Group BHP.AX and Rio Tinto (LON:RIO) RIO.AX both slipping about half a percent.
Energy stocks .AXEJ shed 0.3%, with major oil and gas players Santos Ltd STO.AX and Oil Search OSH.AX falling 0.5% and 0.8%, respectively.
Meanwhile, New Zealand's benchmark S&P/NZX 50 index .NZ50 dipped 0.3% to 11,180.2.
Dairy processing company Synlait Milk SML.NZ fell as much as 1.7%, while energy retailer Mercury NZ MCY.NZ shed up to 3.2%, marking its worst session since April 18.