Australian shares have given up early gains in noon trading, with traders spooked by news of tightened restrictions in the country’s largest state and a surge in cases in the second largest state.
The S&P/ASX200 benchmark index was higher by just 0.4 points, or 0.01 per cent, at 6011.3 points at 1200 AEST after rising more than half-a-per cent earlier on Friday.
The All Ordinaries index was lower by 2.5 points, or 0.04 per cent, at 6120.5.
NSW Premier Gladys Berejiklian has extended restrictions to all indoor hospitality and event venues after the state recorded 8 new virus cases in the last 24 hours. The restrictions limit venues to 300 people.
The state is on alert after an outbreak at a hotel in Sydney’s southwest.
Neighbouring Victoria has reported three more deaths and 428 new coronavirus cases – the largest daily increase in cases since the pandemic began, which could prompt even tighter restrictions in the state.
In the local market, utilities and telecommunications were the best performing sectors, up around 0.4 per cent each.
The heavyweight financials sector was trading lower.
Among the major banks, ANZ dipped 0.32 per cent to $18.43, the Commonwealth Bank dropped 0.29 per cent to $72.43 and NAB edged lower by 0.28 per cent to $18.02.
Westpac shares were up 0.11 per cent to $17.83 despite a class action looming that alleges the bank and St George Finance colluded with car dealers to charge customers inflated interest on loans.
Miners were faring better thanks to continuing strong demand for iron ore.
Rio Tinto gained 0.37 per cent to $103.89 after it reported a 1.5 per cent rise in iron ore shipments for the June quarter following strong Chinese demand for the steelmaking component.
Fortescue did even better, up 0.87 per cent to $16.25, while BHP was down 0.04 per cent to $37.74.
Steelmaker BlueScope lost 2.9 per cent to $11.06 after flagging an earnings hit from the coronavirus.
The company expects second half earnings to be about $260 million. BlueScope had previously expected those earnings would be $302.4 million, but scrapped the forecast in March.
The biggest loss was in information technology. The sector was down 0.63 per cent.
Shares in online shopping giant Kogan were down 5.1 per cent to $16.92 after the Federal Court found consumers were misled in a sales promotion.
The Australian Competition and Consumer Commission successfully argued Kogan raised the price of many products by at least 10 per cent before the sale. Penalties are still to be decided.
Energy provider Oil Search had a notable loss among the big guns in the sector. It was down 2.23 per cent to $3.07 amid sector-wide weakness after the OPEC+ group agreed to increase crude oil production.
Overnight, all three major US indices closing in the negative after data showed 1.3 million workers filed for unemployment benefits last week, largely due to coronavirus restrictions, taking the total to 32 million Americans on unemployment benefits.
The Australian dollar was trading lower after the US dollar rose against major currencies for the first time in six trading days. It was at 69.82 US cents by 1200 AEST, down from 69.92 US cents at Thursday’s close.