* Commonwealth Bank biggest check on benchmark
* Miners lead gains, oil stocks up on higher prices (Updates to close)
May 9 (Reuters) - Australian shares ended slightly higher on Wednesday, as gains across a number of sectors following an optimistic budget were offset by financials as the largest bank fell on a disappointing earnings report.
The S&P/ASX 200 index rose 0.26 percent or 16.1 points to 6,108.0. The benchmark inched up 0.1 percent on Tuesday.
Late on Tuesday, Australia’s government said it would return the budget to a small surplus in 2019/20, one year earlier than planned.
It also unveiled some big spending measures, including an income tax cut for low and middle-level earners, along with a substantial infrastructure and health care push.
In Wednesday’s trading, Materials led gains, with metal mining stocks advancing after copper and zinc prices edged up. Index heavyweight BHP Billiton climbed 1.2 percent, a near four-year high, while copper miner OZ Minerals was up 0.7 percent.
Oil stocks rose on stronger prices, with Woodside Petroleum adding about 1.3 percent. Oil and gas explorer Oil Search closed up 1.5 percent.
Oil prices jumped after the United States pulled out of an international nuclear deal with Iran, a move which could curb oil exports from the OPEC member, reducing supply.
In contrast, Australian financials tumbled, led chiefly by Commonwealth Bank of Australia. The stock shed nearly 3 percent and was the single largest drag on the benchmark.
The bank, whose reputation has been dented by scandals, reported a 2 percent fall in third-quarter cash profit as customers switched to cheaper mortgages.
While other major banking stocks were mostly flat, sentiment was soured after Fitch Ratings said on Wednesday it expected the short-term earnings of Australia’s ‘Big Four’ banks to face pressure due to slower credit growth.
Wealth manager Challenger Ltd surged about 5 percent higher. Credit Suisse said the stock stands to benefit from changes in the budget to Australia’s framework for retirement income.
In New Zealand, healthcare stocks pushed the index higher, followed by consumer staples. The benchmark closed higher for a sixth consecutive session.
New Zealand’s benchmark S&P/NZX 50 index rose 0.29 percent or 25.24 points to finish the session at 8,619.83.
Ryman Healthcare was the biggest boost to the index, while a2 Milk Co was 1.1 percent higher. (Reporting by Ambar Warrick in Bengaluru; Editing by Richard Borsuk)