Fears of a new national COVID outbreak weighed on the Australian equity market on Monday, but a rally from a handful of the market’s largest companies helped the index to a stable close.
The S & P / ASX200 fell 0.3% in the first two hours of Monday’s trading, but rose in the afternoon to close at 7307.3, almost unchanged from Friday.
Travel stocks were under pressure as borders closed on news of COVID outbreaks in Sydney, Brisbane, Perth and the Northern Territory. Webjet, Qantas and Flight Center all fell about 4%.
Afterpay fell 7.5% to a one-week low at $ 119.30, while Zip Co fell 7% to $ 7.65.
Information technology dropped early and stayed low all day. It was by far the worst performing industry, with Nearmap down over 4% and EML Payments down 3%.
Gold stocks were in the red as the safe haven traded below US $ 1,800 for a third week.
However, consumer staples were higher as panic buying pushed Woolworths up 2.9%, Coles 0.6% and the new Endeavor Group drinks rose 3.8%.
BHP, Rio Tinto, Commonwealth Bank and CSL Biotech have also stepped up to help the market balance the ledger.
“It’s a very good day considering where we started and our tracks overnight,” said Sean Sequeira, chief investment officer at Australian Eagle Asset Management.
As sudden fears of a national COVID-19 outbreak weighed on travel and consumer discretionary stocks in particular, Mr Sequeira said he was not making any sudden adjustments to his portfolio.
“What we’ve found is that businesses were able to manage their way through this the first time around and will be able to manage their way through this short instance because there is less uncertainty about what to do next. what to expect and less uncertainty about the results. ″
Australia’s economy was still growing, he said, adding that the government would be under pressure to bring JobKeeper back if the lockdown lasted more than two weeks.
The Big Four banks were split with Westpac, National Australia Bank and ANZ Bank, all closing lower, but Commonwealth Bank gained 0.6% after a Citi analyst speculated it had sufficient cash and cash. economic stability for a share buyback.