Australia shares off 7-month lows; healthcare, industrials up

(Adds analysis, quotes, stocks on the move)

By Cecile Lefort and Gyles Beckford

SYDNEY/WELLINGTON, Aug 17 (Reuters) - Australian shares edged up 0.3 percent on Monday, underpinned by gains in healthcare and industrial sectors, with weak energy stocks capping the rally.

The S&P/ASX 200 index rose 18.1 points to 5,374.7 by 0336 GMT, but was still close to a seven-month trough touched on Friday.

Shares (Berlin: DI6.BE - news) in contractor firm Transfield Services rallied 6.3 percent, pulling away from one-year lows hit last week, after it denied allegations of misleading a Senate committee investigating abuse at an immigration centre.

Top coal hauler Aurizon Holdings was also an outperformer, up 4.5 percent after the firm raised its dividend payout well above expectations.

The healthcare sector was in good form with cancer treatment developer Sirtex up 4.75 percent, to show an increase of 22 percent so far this year.

Primary Health Care gained 0.7 percent, while Healthscope (Frankfurt: 2H1.F - news) and Sonic Healthcare (Dusseldorf: SAB.DU - news) added around 0.5 percent each.

Financials were more mixed with Commonwealth Bank of Australia dropping 0.5 percent following a A$2.1 billion rights offer with institutional investors.

In contrast, Westpac Banking Corp rose after an improvement in its stressed loan levels in the third quarter. .

Energy shares, however, were a drag on the index performance, as oil prices lagged. WorleyParsons (Dusseldorf: WF9.DU - news) shed 2.6 percent, while Karoon Gas and Oil Search (Dusseldorf: OIS.DU - news) , were both off around 1.8 percent.

New Zealand stocks were positive with the benchmark NZX50 share index up 0.6 percent at 5,730.04, as it climbed away from a one-month low touched last week.

The market was led higher by telecommunications company Spark rising 3.6 percent, after hitting a two-and-a-half month low on Friday. It (Other OTC: ITGL - news) reports its annual results on Friday.

The index of the top-10 stocks, which make up more than half the benchmark index, was up 0.8 percent.

Contact Energy (NZSE: CEN.NZ - news) , the number four stock by market capitalisation, rose 0.76 percent after reporting a 43 percent fall in bottom line profit and the closure of a gas-fired power station.

Transport company Freightways (Other OTC: FTWYF - news) was up 1.8 percent after reporting a 4 percent lift in annual profit.

Other companies reporting this week include market leaders Fletcher Building (NZSE: FBU.NZ - news) and Meridian Energy (Berlin: 15M1.BE - news) .

Among smaller stocks to post gains were Synlait Milk up 2.9 percent albeit on scant volumes, Tourism Holdings up 3.1 percent, and takeover target Kathmandu up 2.4 percent.

For more individual stocks activity click on (Editing by Jacqueline Wong)