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By Roushni Nair

March 24 - Australian shares ended flat on Monday as gains in financials offset losses in miners, while building materials firm James Hardie plunged after it agreed to buy U.S. artificial decking maker AZEK for $8.75 billion.

The benchmark S&P/ASX 200 index .AXJO edged up 0.07% to 7,936.9 points.

Financials .AXFJ rose over 1%, their highest level in two weeks. The 'Big Four' banks added between 0.5% and 2.5%.

Banking stocks remain resilient as defensive plays are largely insulated from U.S. tariffs, although market participants are now focused on budget implications, said Henry Jennings, senior analyst at Marcustoday Financial Newsletter.

Miners .AXMM, on the other hand, fell 0.2%, with heavyweight BHP BHP.AX declining 0.6%.

China's post-pandemic recovery shows mixed signals as industrial output and retail sales data improved last week, but persistent property sector weakness continues to depress steel and iron ore markets, said Grady Wulff, market analyst at Bell Direct.

Consumer stocks .AXSJ slipped 1.7%, with top grocers Woolworths WOW.AX and Coles COL.AX losing 1.7% and 2%, respectively.

The supermarket companies retreated as investors locked in profits following last week's rally, which was triggered by a regulatory investigation that largely cleared the chains of price-gouging allegations.

Among individual stocks, shares of James Hardie JHX.AX tumbled 14.5%, making it the second-biggest loser on the benchmark, as the AZEK AZEK.N deal's higher earnings multiple and steep premium spooked investors. The stock clocked its worst session since May 21, 2024.

Meanwhile, the focus is on U.S. trade policy developments as the White House prepares to unveil a package of reciprocal tariffs targeting multiple nations on April 2.

Domestically, Australia's government will shift from two years of rare surpluses to a budget deficit on Tuesday as Prime Minister Anthony Albanese deploys household relief measures before the May elections.

Investors also await inflation numbers for February on Wednesday, with economists' expecting an annual rise of 2.5% for the month.

New Zealand's benchmark S&P/NZX 50 index .NZ50 rose marginally by 0.1% at 12,128.2 points.

(Reporting by Roushni Nair in Bengaluru; Editing by Sonia Cheema)

((Roushni.Nair@thomsonreuters.com;))

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