* Aussie shares up as much as 0.5 pct
* Banks cap gains
* NZ shares buoyed by healthcare, construction
By Chris Thomas
March 16 (Reuters) - Australian shares rose on Friday, boosted by retail giant Wesfarmers which soared after announcing plans to spin off its Coles supermarket division, but falls in banking stocks limited gains.
The S&P/ASX 200 index .AXJO rose 0.3 percent or 14.6 points to 5,935.4 by 0031 GMT, but was set to finish the week lower. The benchmark fell 0.2 percent on Thursday.
Investors rushed to buy Wesfarmers' WES.AX stock after it announced plans to spin off its Coles supermarket chain and list it on the Australian Securities Exchange, sending shares up as much as 6 percent - its biggest intraday surge in over eight years. Woolworths WOW.AX rose as much as 2 percent.
Materials stocks added to the gains on the index, riding on strong metal prices, with top miners BHP Billiton (LON:BLT) BHP.AX and Rio Tinto (LON:RIO) RIO.AX up 1.2 percent and 1.1 percent, respectively. IRONORE/
South32 Ltd S32.AX rose as much as 3.6 percent after Credit Suisse (SIX:CSGN) upgraded the stock to "neutral" from "underperform".
Fashion retailer Premier Investments PMV.AX was the top gainer on the index, up as much as 7.5 percent to its highest since Oct. 2016 after reporting a 9.4 percent climb in first-half profit. gains) are relatively short-term at the moment because markets are looking forward to what's going to happen next week with the U.S. Federal Reserve, and when you're at stretch valuations that's probably a negative," said Mathan Somasundaram, market portfolio strategist at Blue Ocean Equities.
The U.S. central bank is expected to raise interest rates for the first time this year at the Federal Open Market Committee meeting next week.
Financial stocks capped the gains on the index, with the index .AXFJ down for a fourth straight session amid a government backed inquiry into the sector.
The "Big Four" banks fell 0.5 and 0.9 percent. The hearing on Thursday revealed Commonwealth Bank of Australia CBA.AX knew that a system of financial incentives to reward mortgage brokers could hurt customers but failed to act. Zealand's benchmark S&P/NZX 50 index .NZ50 reversed early losses to rise as much as 0.2 percent, and is set to end the week up about 1.1 percent.
Fisher & Paykel Healthcare Corporation Ltd FPH.NZ was the biggest contributor to the index, rising as much as 1.8 percent, while construction firm Fletcher Building Ltd FBU.NZ climbed 2.3 percent.