March 21 (Reuters) - Australian shares were range-bound on Friday, with miners leading declines due to tepid iron ore prices, though supermarket giants limited the negative impact after analysts claimed that a regulator's report would not affect earnings.

The S&P/ASX 200 index .AXJO held its ground at 7,914 points.

Miners .AXMM in Sydney dropped 0.5% after iron ore futures fell for a fourth consecutive session, dampened by demand outlook from top metals customer China.

Shares in sector behemoths BHP Group BHP.AX, Rio Tinto RIO.AX and Fortescue FMG.AX dipped 0.1%, 0.1% and 0.3%, respectively.

Energy stocks .AXEJ declined despite an increase in oil prices. Woodside Energy WDS.AX and Santos STO.AX were trading lower between 0.1% and 0.2%.

The benchmark losses were offset by a 0.2% gain in financials .AXFJ, following Australia's surprise drop in employment during February. The data released on Thursday fuelled expectations of further interest rate cuts this year.

Except Westpac WBC.AX, which was trading in the red, all the other three major banks climbed between 0.3% and 0.8%.

Australia's dominant supermarket chains have benefited from wider profit margins at a time of rapidly increasing shelf prices, the competition regulator said in a new report on Thursday, and called for measures to make the industry fairer.

Analysts at Citi said the report appeared "benign", as expected, flagging that there was no recommendation around regulation of grocery prices or the ways promotions are conducted.

"While we do see heightened media publicity around the announcement as likely to negatively impact the supermarkets in the near term, we do not expect a material impact to supermarket earnings from the recommendations."

Shares of Woolworths WOW.AX gained 5.2% while Coles COL.AX was up 3.3%.

In company news, Nine Entertainment NEC.AX said it was in discussions with CoStar CSGP.O for the latter to submit a revised proposal for the media firm's majority-owned Domain DHG.AX.

Nine climbed 1.3% while Domain was trading up 1.2%.

New Zealand's benchmark S&P/NZX 50 index .NZ50 fell 0.3%.

(Reporting by Rishav Chatterjee in Bengaluru; Editing by Sherry Jacob-Phillips)

((Rishav.Chatterjee@thomsonreuters.com;))

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