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The share market trimmed early falls to finish little changed as Sydney’s coronavirus lockdown prompted a revival of early pandemic-style trading.

Supermarkets, grog shops and e-tailers rallied after the NSW government issued stay-at-home orders for Greater Sydney. Shopping centres, casinos, airlines and travel agents declined.   

The end result was the S&P/ASX 200 closed near flat. The index fell as much as 34 points in early action before paring its loss to less than a point or 0.01 per cent.

What moved the market

The market retreated for the third time in four sessions as investors weighed the economic hit from a two-week lockdown in Greater Sydney and the danger the Bondi breakout could seed other states. Darwin today extended a snap 48-hour lockdown for another 72 hours following a fourth new case. Queensland, WA, Victoria and South Australia have all tightened restrictions over the last 48 hours.

“Australia’s low vaccination rollout makes the economy increasingly vulnerable given the new highly contagious COVID delta-variant sweeping the world,” David Bassanese, chief economist at BetaShares, said. “Extended lockdowns could severely knock economic growth in the short-term and see the local share market materially lag its global peers.”

NSW health authorities this morning announced 18 new locally-acquired Covid-19 cases in the 24 hours to 8 pm last night, increasing the total number of cases in the current breakout to 130. Queensland recorded two new cases, NT and WA one case each,  Victoria and the ACT zero.

The day’s action underlined the gulf between winners and losers from pandemic lockdowns. Online retailer Kogan climbed 6.56 per cent, Temple & Webster 10.24 per cent and Redbubble 8.16 per cent. Supermarkets Woolworths and Coles rose 2.91 and 0.59 per cent, respectively.

Qantas sank 4.02 per cent to a six-week low. Sydney Airport shed 1.02 per cent. Travel agents Flight Centre and Webjet lost 3.45 and 4.74 per cent.

Shopping centre operators also declined. Unibail-Rodamco-Westfield shed 2.83 per cent, Scentre Group 2.49 per cent and Vicinity Centres 2.42 per cent. Casino groups Crown and Star Entertainment fell 1 and 1.36 per cent.

The deteriorating domestic outlook overshadowed a positive end to Wall Street’s best week since February. The S&P 500 rose 0.33 per cent on Friday to a record close and a weekly tally of 2.74 per cent.

US futures trimmed gains this afternoon as Asian markets drifted. S&P 500 futures gained four points or 0.1 per cent. Japan’s Nikkei eased 0.17 per cent, China’s Shanghai Composite 0.11 per cent and Hong Kong’s Hang Seng 0.17 per cent.

Winners’ circle

Consumer staples was the day’s best performer amid reports of panic buying as Sydneysiders prepared to stay home. The newly-listed Endeavour Group (Dan Murphy’s and BWS) jumped 3.77 per cent.

Metcash rallied 0.82 per cent as a shift in shopping habits helped the operator of the IGA network lift full-year underlying profit 27.1 per cent to $252.7 million. Charge-through sales exceeded $16 billion for the first time. CEO Jeff Adams said greater competitiveness helped the group’s retailers gain customers.

“This, together with the continuation of an increased preference for local neighbourhood shopping and the migration from cities to regional areas, has driven strong sales growth across our independent retail networks, significantly improving their overall health,” Mr Adams said.

Healthcare was the session’s other leader, reflecting the defensive tone to the day’s trade. Sonic climbed 1.55 per cent, Fisher & Paykel 1.74 per cent and CSL 1.15 per cent.

The major miners were mixed but mostly higher following upticks in iron ore and precious metals on Friday. BHP added 1.04 per cent, Rio Tinto 0.66 per cent and Fortescue 0.57 per cent. Newcrest dipped 1.15 per cent.

Doghouse

Westpac eased 0.27 per cent after announcing the sale of its car dealer finance and leasing business to non-bank finance firm Angle Finance. The sale will generate an accounting gain on completion. The bank is in the process of reducing costs and exiting non-core businesses.

ANZ shed 0.32 per cent and NAB 0.23 per cent. CBA edged up 0.61 per cent.

A production miss sent Gold Road Resources down 7.39 per cent. The miner said disruptions at the Gruyere mine would drag calendar-year production towards the lower end of previous guidance. Problems at the mill included a torn mill feed conveyer belt and a failed coupling on the ball mill.

Afterpay dived 7.52 per cent as a rally in bond yields weighed on technology and other sectors whose future earnings depend heavily on borrowing to fund growth. Z1P Co sank 7.05 per cent, Nearmap 4.21 per cent, EML Payments 3.23 per cent and Appen 2.48 per cent.  

Buy-now-pay-later operator Splitit dipped 2.61 per cent after announcing its entry into the Middle East market. Splitit will partner with regional BNPL player tabby to integrate Splitit’s instalment payment solution as a white-label component of tabby’s platform. Splitit says tabby is the leading BNPL provider in Saudi Arabia and the United Arab Emirates.

Nine Entertainment announced it had secured the broadcast rights to some of Europe’s blue-riband soccer events. The UEFA Champions League, Europa League and Europa Conference League will be exclusive to Stan for three years. Nine’s share price eased 0.67 per cent.

Other markets

Gold shook off an early dip to rise US$7.50 or 0.42 per cent to US$1,785.30 an ounce. Brent crude declined ten cents or 0.13 per cent to US$75.28 a barrel.

The dollar faded 0.08 per cent to 75.88 US cents.

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