* Financials set for 4th straight weekly gain
* Australia's Syrah Resources weighs on mining index
* NZ manufacturing activity in contraction for second month
By Nikhil Subba
Sept 13 (Reuters) - Australian shares edged up on Friday, with the benchmark set for its fourth week of gains, buoyed by signs of progress in the U.S.-China trade war and stimulus measures announced by the European Central Bank.
The S&P/ASX 200 index .AXJO rose 0.2%, or 10.4 points, to 6,667.10 by 0212 GMT, with financials leading gains. The benchmark closed 0.3% higher on Thursday.
Market sentiment was lifted by gains on Wall Street, with the S&P 500 closing at a near record high on Thursday. Investors are hopeful of a U.S.-China trade resolution after Beijing and Washington made concessions ahead of next month's planned talks aimed at easing a trade war that has stoked fears of recession.
Overnight, the European Central Bank (ECB) promised continued stimulus to the ailing euro zone economy through asset purchases. gains were, however, capped as "the psychology of the market is that they really are waiting for direction in a lot of those international things, particularly the U.S.-China situation", said Doug Symes, senior client adviser at Novus Capital.
The Australian financial index .AXFJ rose 0.6%, on track for its fourth week of gains and highest weekly rise since May 24.
"The banking section has been quite strong the last few days and has continued to be firm today...that is associated more with the fact that people are feeling that banks are starting to implement a lot of the things that were requested by the Royal Commission", said Symes.
Commonwealth Bank of Australia CBA.AX was the best performer among the "Big Four" lenders, climbing about 1% to a near six-week high.
Energy Stocks .AXEJ gained about 0.1%, heading towards their second consecutive weekly gain, with industry heavyweights Santos Ltd STO.AX and Woodside Petroleum WPL.AX climbing around 0.2% each.
Meanwhile, the mining sector .AXMM slipped 0.5%, dented by Syrah Resources' SYR.AX more than 8% fall, after the graphite miner said it would reduce production in the third quarter and posted a huge rise in half-yearly losses. stocks .AXGD were on their way to a second weekly decline as improving global risk sentiment lowered prices for the precious metal.
New Zealand's benchmark S&P/NZX 50 index .NZ50 slipped 0.2%, or 19.46 points, to 10,885.06, pressured by energy and utilities.
Electricity and natural gas supplier Contact Energy CEN.NZ fell as much as 2.5%, and was the top loser on the New Zealand benchmark, followed by fuel retailer Z Energy Ltd ZEL.NZ , which shed 1.8%.
Manufacturing activity in New Zealand edged up but remained in contraction for the second consecutive month in August due to declines in new orders, a survey showed on Friday.