Australian shares managed to break a three-day losing streak on Monday, despite investors fleeing AMP and Woolworths and jitters around the region following news the FBI is planning to review more of Hillary Clinton's emails.
Investors poured into defensive holdings, such as industrials, utilities and resources as speculation heightened that Donald Trump may be closer to winning the Presidency than previously thought.
The benchmark S$P/ASX200 Index and the broader All Ordinaries Index each closed 0.6 per cent higher to 5317.7 points and 5402.4 points respectively.
Gains in iron ore and gold provided support for resources giants BHP Billiton and Rio Tinto, the latter of which also announced it plans to sell its Simandou iron ore project in Guinea to China's Chinalco. BHP finished up 0.1 per cent and Rio Tinto closed 0.4 per cent higher.
Qantas shares yo-yoed quite steeply on Monday, with shares plunging as much as 9 per cent after the company announced it expects underlying first-half net profit to fall up to 13 per cent as it slashes costs. However, investors had a change of heart just before lunchtime and the airline's share price rebounded 13 per cent, before closing up 4.1 per cent to $3.06.
"It looks like a case of sell the rumour, buy the fact," says David Fraser, senior investment analyst at Shaw & Partners. "The Qantas stock has come under all sorts of pressure lately, there are two or three people out there with numbers that were significantly higher than what the company actually reported.
"I think the sticker shock had some people stressing that there were going to be lots of downgrades, but I think the market already knew that anyway, that's why the price has recovered," he said.
Shares in ANZ lifted higher after the bank announced it has agreed to sell its retail banking operations and wealth management businesses in five Asian countries to DBS of Singapore. Investors were pleased and sent the stock up 0.8 per cent to $27.85.
The rest of the big banks enjoyed moderate support throughout Monday, closing between 0.3 and 0.9 per cent higher.
However, Macquarie Group and more than 20 other smaller lenders had the outlook on their credit scores lowered by Standard & Poor's. Shares in Macquarie slid 2.4 per cent, as investors repositioned after last week's jump, while Bendigo Bank and Bank of Queensland finished 1.7 per cent and 0.7 per cent higher respectively.
Investors have continued to flee AMP after Bell Potter labelled the bank's business update on Friday as "shockingly bad". The stock fell a further 2.4 per cent on Monday, after plunging more than 10 per cent on Friday. The stock closed at $4.57.
Investors are still shunning Woolworths shares after a court heard the supermarket operator attempted to extract "unreasonable" payments from suppliers to fill a $50 million hole in its profits. The stock fell 2.4 per cent to close at $23.65 with main rival Wesfarmers, operator of Coles, closing 1.7 per cent higher.
Investors provided some support for Australia's largest oil producer Woodside Petroleum on Monday after analysts said the recent $US5 billion cost blowout at Chevron's Weatstone LNG project came as no surprise. The stock closed 0.2 per cent higher at $28.37.
Orocobre
Shares in the lithium produced surged 20 per cent on Monday to $3.83, after last week's announcement that it was still getting high prices even as it missed its own production forecasts. The company posted sales revenue of $33.5 million from its lithium facility, up 45 per cent quarter-on-quarter. The company's production from its lithium facility rose 2 per cent q/q to 3103 tonnes. The miner reaffirmed its second-quarter output guidance and didn't change its full-year forecast. The price surge on Monday will be squeezing short sellers, which have poured into the stock in recent times. Short interest in the stock is close to 8 per cent, much higher than a few weeks ago. The shares reached as high as $5 in June from $1.33 in December last year, but have since cooled off to be "only" 57 per cent up in 2016.
Ratings outlook
Standard & Poor's has placed the ratings outlooks of 25 Australian banks, insurers and buildings societies on negative watch as it becomes concerned about rising household debt and property values. The agency has adjusted its assessment of Australia's economic risk trends from stable to negative. Among the largest institutions impacted are AMP Bank, Bank of Queensland, Bendigo and Adelaide Bank, Macquarie whose current ratings were placed on negative outlook.
Gold
Investors boosted the gold price on Monday as demand for safe haven assets increased after new polls in the United State indicated that Donald Trump may be closing in on Hillary Clinton for the presidency. Bullion climbed as much as 0.2 per cent higher to $US1277 an ounce on Monday afternoon following last week's revelation by the FBI that it had re-opened its inquiry into Mrs Clinton's emails. The uncertainty surrounding the US election has supported the precious metal in recent times, as investors speculate on how a Trump presidency may affect the global economy. Australia's largest gold producer Newcrest Mining closed up 5.3 per cent to $22.56.
Oil
The price of crude oil has slipped further as the OPEC nations failed to agree on how much each country should trim output in a meeting held last Friday. Energy stocks were off 0.3 per cent on Monday as a result and brent crude was fetching $US49.45 a barrel late in the session. There is much deliberation over whether the OPEC nations can actually implement a production cap for the first time in eight years at its official November meeting. Both Iran, Iraq and Venezuela are angling to be exempt from any cuts. Representatives from non-OPEC producers Azerbaijan, Brazil, Kazakhstan, Mexico, Oman and Russia also attended the meeting. Those countries collectively produce about 21 per cent of global supply and equivalent of half of OPEC's output, according to Bloomberg.
Boral
Building materials supplier Boral will sell its 40 per cent stake in the Boral CSR Bricks joint-venture to CSR for $133.9 million. Boral will make a profit of $20 million to $25 million on the sale, which will be reported as a significant item in fiscal 2017. Chief executive Mike Kane says the joint-venture has performed well, but now is the time to realise value for the business and redirect capital to Boral's core operations. Investors weren't impressed, sending Boral shares down 0.8 per cent to $6.30 while CSR are flat at $3.66.