Australian shares ended flat today, giving up early gains after data showing China's manufacturing sector remained in contraction in September fuelled investor worries about weak global growth.
Big banks edged higher, while among the major miners BHP Billiton added 0.2 per cent and rival Rio Tinto was flat.
Mining and steel maker Arrium jumped 25 per cent after rejecting a $1.01 billion bid by a consortium aiming to cash in on a drop in the value of resource firms as commodites prices have tumbled.
The benchmark S&P/ASX 200 index closed up just 1.6 points at 4,388.6, after rallying as much as 0.6 per cent in early trade.
The benchmark rose 7.1 per cent in the third quarter, its best quarterly performance in three years.
China's official factory purchasing managers' index improved to 49.8 in September from 49.2 in August, but stayed below the 50 line that points to contraction.
Westpac led gains among the big banks, rising 0.4 per cent as investors eyed the sector's strong dividend yield.
Australia's central bank holds its monthly policy meeting on Tuesday and is expected to keep the cash rate steady at 3.5 per cent, although some economists see a chance of a quarter-point cut.
"The aggressive interest rate cuts which have been expected perhaps are leading people to buy a few banks today and also for the dividend yield," said Chris Weston, market strategist at IG Markets.
Defensive stocks eased, with telecommunications giant Telstra falling 1 per cent, blood products maker CSL down 0.5 per cent and supermarket retailer Wesfarmers down 1 per cent.