Australian shares scaled a fresh all-time closing high on Friday, as a strong rally in miners offset losses across much of the index, including a cratering share price drop for embattled casino operator Star Entertainment.

The S&P/ASX 200 closed up 8.5 points, or 0.1 per cent, to 8212.2. On the week, the index ended flat, following two weeks of gain. The advance was heavily concentrated in materials, as China’s stimulus pledges this week bolstered optimism for iron ore, copper and lithium demand.

Shares in Rio Tinto rallied 3.4 per cent to $127.45, and BHP climbed to a four-month high of $44.86 and closed 3.1 per cent higher at $44.74. Fortescue advanced 3.6 per cent to $20.1. The push higher came after iron ore prices jumped more than 4 per cent in Asia to trade above $US100 per tonne.

Lithium miners also vaulted, led by a 14 per cent leap in Mineral Resources to $49.14. Sayona jumped more than 6.9 per cent to 3.2¢ and Liontown Resources powered up 8.3 per cent to 78.5¢ as speculators were forced to cover their short bets on the sector.

“There’s such a huge short interest across the sector that those positions would be nervous. That’s probably why there is a decent of wave of buying happening at the moment,” said Sam Berridge, portfolio manager of Perennial’s Natural Resources Trust.

“The implication is that demand for electric vehicles will pick up,” said Mr Berridge.

On the ASX, of the 11 sectors, eight were flashing red – with health leading the losses. The big four banks fell as the stock rotation out of financials to miners continued. National Australia Bank dropped 1.8 per cent to $36.94.

Casino group Star Entertainment was by far the biggest casualty on the index, clocking a 44.4 per cent plunge to 25¢. Shares had been halted for four weeks in the lead-up to Friday’s sell-off as the company scrambled to shore up its financial position before releasing its financials.

Woolworths and Coles were down most of the day after the competition watchdog ramped up pressure on the supermarket giants. Coles slipped 0.5 per cent to $18.06 but Woolies managed to bounce late in the session to end 0.2 per cent higher to $33.43.

Hospitality and beverages company Endeavour Group was among the biggest losers on the ASX, down 2.5 per cent to $4.99 on news that its chief executive Steve Donohue was leaving.

Funds management company GQG Partners dropped 2.4 per cent to $2.81 after copping a $725,000 penalty from the US regulator for violating whistleblower protection rules.

And, De Grey Mining lifted 3.4 per cent to $1.385 as it denied a media report suggesting the gold miner had received a bid offer from Canada’s Agnico Eagle.