Although peaking early at an intraday high of 5402.4, the benchmark S&P/ASX 200 index quickly dipped into the red before recovering through the reset of the session to close up 16 points, or by 0.3 per cent, at 5388.1. The broader All Ordinaries lifted 0.3 per cent to 5451.9.

Data from the Australian Bureau of Statistics revealed business investment fell by 5.2 per cent in the March quarter, which was worse than forecast.

However, Macquarie division director Martin Lakos said the result had little impact on the market. "We didn't didn't see the needle move," he said. "The market softened but not dramatically so."

"The main drivers were energy and materials - oil touched $US50 per barrel so that's keeping the energy space buoyant," he said.

After an amazing stretch of six straight weeks of gains, shares are eyeing the next psychological level.

"The S&P/ASX200 is just failing to break 5400 at the moment so we need a new catalyst for that to break higher," Mr Lakos said.

Consumer staples were the major drag on the market, with Wesfarmers declining 3.6 per cent to $40.40 in the wake of Wednesday's $2.3 billion Target write-down and after a analysts at Deutsche Bank said they now expected a 10 per cent cut in the company's dividend this financial year, from $2 to $1.80.

Citi also tipped a dividend cut, but by a much lower 3 cents to $1.97, while Macquarie predicts a reduction to $1.92. But Credit Suisse remains optimistic, tipping a rise by 3 cents.

Wesfarmers' main competitor, Woolworths, also had a poor day, losing 1.2 per cent to $22.01.

"The fact that Woolworths is also suffering a sell-off today is indicating that the market is pricing in declining industry dynamics, as opposed to the positive effects on Woolworths' should Wesfarmers continue to fall out of favour," said Gary Huxtable, private client adviser at Atlantic Pacific Securities.

Among the blue-chip miners, BHP Billiton rose 2.7 per cent to $19.41 and Rio Tinto put on 1 per cent to $45.48. Telstra lost 0.5 per cent to $5.66.

The banks were mixed: ANZ Banking Group rose by 1 per cent to $25.54, Commonwealth Bank lifted 0.2 per cent to $78.59, National Australia Bank fell 0.4 per cent to $27.36 and Westpac gained 1 per cent to $30.75.

Energy stocks reaped the gains from the rising oil price with Oil Search rose 0.1 per cent to $6.71, Santos gained 4.9 per cent to $4.49 and Woodside lifted 2 per cent to $27.71.

Poker machine maker Aristocrat Leisure rose 0.1 per cent to $12.45 after boosting its net profit for the first half of 2016 by 66 per cent to $183.2 million due to strong growth in Australia and North America and more punters using its social gaming apps.

Aristocrat, which foreshadowed the result to the market earlier in May, increased its dividend for the six-monthly period by 2 cents to 10 cents per share and said the result marked its tenth consecutive period of earnings growth.

Asciano dropped 0.1 per cent to $8.85 after the competition regulator flagged concerns over the vertical integration of Patrick container terminals with Qube and Australian Container Freight Services.

The Australian Competition and Consumer Commission released a statement of issues which means its final decision on the drawn out takeover deal will now be delayed until July 21 and the transaction will now stretch to more than a year if completed.

WorleyParsons shares shot up 4.6 per cent to $6.37 after Deutsche raised its price target on the stock to $4.68 from $2.88, while maintaining its "sell" rating.