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The share market hit a three-week high before finishing flat as caution set in ahead of a number of “risk events” in the US this week.

The S&P/ASX 200 drew within four points of last month’s record close before a session-long fade. A sell-off in the closing auction saw the index turn negative for the first time all day, finishing one point or 0.02 per cent in the red.

Solid gains in industrials, utilities and supermarkets were offset by declines in REITs, oil companies and most of the banks.

What moved the market

The benchmark has been stuck in a broadly sideways trading pattern since the start of the NSW coronavirus outbreak. Traders have been happy to buy below 7250 and sell above 7350. Today’s rise and retreat mirrored similar failed breakout attempts over the last two weeks. The index finished at 7332.

Today’s market fizzle preceded a deluge of corporate and economic data in the US that has the potential to alter the market tone. The second-quarter earnings season kicks off tonight with reports from Goldman Sachs and JPMorgan Chase. Inflation reports tonight and tomorrow, plus two days of congressional testimony from Federal Reserve Chair Jerome Powell make for a potentially explosive week.

“High hopes are attached to the banking sector that can produce blowout results for the second quarter, given that all major lenders recently passed the Federal Reserve’s stress test,” Kalkine Group CEO Kunal Sawhney said. “The market is also anticipating big profit comebacks from the consumer discretionary and energy sectors, which are expected to reap the rewards of a return to normalcy.

“Investors are likely to carefully evaluate if companies’ results and future expectations justify the high valuations in the share market… We may see investors gravitating towards companies beating expectations now and likely to outperform into the future.”

Overnight, the S&P 500 and Dow both climbed around 0.35 per cent to record closes. US futures marked time this afternoon. S&P 500 futures dipped four points or almost 0.1 per cent.

The morning brought brighter news for locked-down Sydneysiders. Health authorities reported a decline in new local Covid cases to 89 in the 24 hours to 8pm last night from 112 over the prior period. Queensland and Victoria reported two new local cases each.

Consumer confidence rebounded last week as lockdowns ended in Brisbane, Perth and Darwin. The ANZ-Roy Morgan weekly confidence index rose from 107.8 to 110.

Business confidence eased from exceptionally high levels, but remained elevated by historic standards. NAB’s sentiment index dropped to 11 last month from 20 in May. The conditions index fell to 24 from 36. The survey was carried out before the NSW lockdown.

Winners’ circle

Sectors tied to economic growth outperformed in the morning before the market took on an increasingly defensive bent. By the close, utilities, consumer staples and healthcare had joined industrials as the best-performing sectors. The big miners slashed early gains and most of the banks dipped into the red.

Fortescue Metals was the best of the miners, up 2.11 per cent. Rio Tinto held on to a gain of 0.6 per cent. Newcrest added 0.35 per cent. BHP fell 0.69 per cent.

Transurban was one of the few heavyweights to hold its gains into the close, rising 1.32 per cent. Brambles added 0.88 per cent, Coles 0.84 per cent, Telstra 0.54 per cent and Woolworths 0.53 per cent.

A profit upgrade lifted aerial mapping firm Nearmap 14.36 per cent to its highest level since early May. The company announced it expected annual contract value for the year of $133.8 million, topping recent guidance of $128 – $132 million.

Shares in the tech firm slumped in May when a US rival lodged a court action alleging patent infringement. Nearmap said it would defend the claims.

Incitec Pivot jumped 5.76 per cent on news its Waggaman ammonia plant in the US had regained full production following a shutdown for repairs. The company also announced changes to its management structure.

YouFoodz‘s time on the boards looks like being short after the Queensland food delivery service agreed to be swallowed by multinational HelloFresh. The Australian company listed at $1.50 in December but quickly lost more than two-thirds of its market value.

HelloFresh has struck a deal to buy out shareholders at 93 cents per share – an 82 per cent premium to yesterday’s closing price. Shares in the Aussie firm jumped 77.45 per cent to 90.5 cents.

Waste manager Bingo Industries will also exit the bourse after shareholders voted overwhelmingly to accept a takeover offer from Macquarie Infrastructure and Real Assets. Almost 97 per cent of votes cast today were in favour of the $2.3 billion takeover. Bingo shares edged up 0.29 per cent.

Doghouse

Most of the finance giants faded as the session wore on. CBA eased 0.79 per cent, Westpac 0.74 per cent, Macquarie Group 0.31 per cent and ANZ 0.54 per cent. NAB edged up 0.08 per cent.

Oil’s first setback in three sessions weighed on producers. Woodside Petroleum eased 1.45 per cent, Oil Search 0.52 per cent and Santos 0.42 per cent.

Asset manager Platinum sank 8.26 per cent after reporting net outflows of $167 million last month.

Other markets

Asian markets climbed for a second day. The Asia Dow put on 0.85 per cent, China’s Shanghai Composite 0.29 per cent, Hong Kong’s Hang Seng 1.66 per cent and Japan’s Nikkei 0.5 per cent.

Oil pared overnight falls. Brent crude bounced 18 US cents or 0.24 per cent to US$75.34 a barrel. Gold trimmed a strong early advance to US$1.30 or 0.07 per cent at US$1,807.20 an ounce.

The dollar rose 0.18 per cent to 74.91 US cents.

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