The Australian sharemarket shook off its negative start but failed to post a gain, ending flat as the two big consumer staple stocks, Woolworths and Wesfarmers fell on the threat of new competition.
The S&P/ASX 200 Index started the week lower as it followed Wall Street's weak Friday lead, before rising in the afternoon and bouncing along break even point. At close of trade, the benchmark Index was just 0.1 of a point higher at 5431.4, while the All Ordinaries ended 0.5 of a point higher at 5519.1.
The flat finish also reflected a hesitation among investors ahead of Tuesday morning's US presidential debate, which may result in the market repricing the odds of a Donald Trump versus Hillary Clinton presidency. US futures pointed to another weak session ahead of the televised event.
"People are very cautious and so they should be," Morgans stockbroker Troy Fidler said. "The upcoming US election but also the potential interest rate hike both of those macro things affect our market here."
The big four banks ended mostly flat, driving the performance of the overall Index, while the biggest movement came in real estate and consumer staples sectors, which were the best and worst performing sectors, rising 1.5 per cent and falling 1 per cent respectively.
Woolworths was the biggest drag on the index, falling 2.1 per cent, followed by rival Wesfarmers, down 0.7 per cent. It came after news emerged that German discount supermarket chain Lidl had applied for trademarks in Australia.
"Whenever a foreign player is mentioned in the press, it has a short-term effect, but that eventually blows over," Mr Fidler said. "Coles and Woolworths are very well established here and I'm a big believer those companies will survive any foreign threat.
"Aldi has been here for 15 years now, and it's taken them quite a while to get the 11 or 12 per cent market share."
Scentre Group and Westfield led the gains by weight, up 1.3 per cent and 1.4 per cent respectively.
The day's best performing stock was SAI Global, which surged 28.7 per cent after it announced it had accepted a $1.1 billion takeover bid.
Energy stocks shrugged off the weak lead set by a 4 per cent drop in oil prices on the weekend after they stabilised through Asian trade, with Santos still fell 1.9 per cent, but its losses were offset by another strong session for Whitehaven Coal, which finished up 7.5 per cent.
Market movers
Brent crude
The price of Brent crude steadied on Monday through Asian trade, rising 0.9 per cent to $US46.31 a barrel despite falling by the most in more than two months over the weekend after talks between producers Saudi Arabia and Iran failed to come to an agreement on a supply freeze. The commodity fell 4 per cent on Friday, however an offer by Saudi Arabia to cut its output if fellow producer Iran capped its own supply raised hopes for a future deal.
SAI Global
Shares in the information and standards company soared on Monday by as much as 31 per cent on news it had accepted a $1.1 billion takeover from Baring Asia Private Equity. The board unanimously accepted a $4.75 a share all-cash bid, a 32 per cent premium on its Friday closing price of $3.59. The share price jump was the company's biggest one day jump since listing. The deal comes more than two years after local outfit Pacific Equity Partners made a similarly priced bid but the firm later walked away from.
Currencies
While the Australian dollar lost some ground in the wake of US dollar strength, steading in the local session to fetch around US76.23¢, its peer across the ditch fell to a one-month low. The New Zealand dollar fell to US72.21¢ after official data revealed its trade deficit had widened more than expected. Meanwhile, the Turkish lira took a dive, extending its losses and hitting a six week low after ratings agency Moody's on Friday cut the country's credit rating to junk.
Asian shares
Shares in Hong Kong fell to a two-week low, while the broad MSCI Asia Index slipped from its 14-month high in the wake of the failure for the informal talks between OPEC members to materialise in a curb in output. While oil prices stabilised throughout trade, the big fall at the weekend weighed on sentiment, while futures pointed to a weak start for European and US shares, which will trade ahead of the US presidential debate between Hillary Clinton and Donald Trump.
Stock watch: Whitehaven Coal
So much for a dying industry: coal miner Whitehaven Coal is the second-best performing stock on the ASX 200 this year, surging 268 per cent. It posted yet another strong session on Monday, climbing 7.5 per cent and has been a regular fixture on the top of the leaderboard on the ASX this year.
While the company does not sell to China, the stability of the world's second biggest economy has given support to commodity prices this year, including coal. While coking coal, used in steel-making, has captured attention this year for doubling in price, steaming coal, used in energy production and Whitehaven's main product, has risen 40 per cent to around $US215 a tonne.
The company has used the lift in prices to pay down debt, but also a potential boost from its Maules Creek project, which is currently under construction. Three of 14 analysts on Bloomberg have a "buy" rating on the stock, while five have a "hold" and five a "sell".
Whitehaven shares closed at $2.58 on Monday.
