The S&P;/ASX 200 index on Monday threatened to break below 5700 points, the lower end of a rough 100-point trading range in which the benchmark measure has been trapped for three months, but ended the session off 33 points, or 0.6 per cent, at 5709.
Weighing heaviest were the major banks, as news of a inquiry by the prudential regulator into CBA's compliance failures around money laundering heaped further pressure on the country's largest lender. CBA dropped 1.3 per cent, Westpac 1.8 per cent, ANZ 0.5 per cent and NAB 0.7 per cent.
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ASX winners and losers - a snapshot
On Wednesday, the Aussie dollar creeps toward US80c and Telstra shares fall over six per cent.
Qantas, too, dragged on the market as a broker downgraded the stock and the airline announced a management reshuffle. The shares fell 5.7 per cent.
The upward momentum in miners stalled on Monday as some of the heat came out of metals markets and the euphoria of recent bumper profit results faded.
![The ASX had a poor start to the week as earnings season winds down.](http://web.archive.org./web/20170830233430im_/https://www.fairfaxstatic.com.au/content/dam/images/g/t/e/j/7/y/image.related.articleLeadwide.620x349.gy5l92.png/1503904368139.jpg)
Fortescue ended the day down 1.7 per cent, while Rio Tinto lost 1.2 per cent. Energy names powered higher, however, as oil prices advanced, which helped the sector rise 0.7 per cent - the only corner of the ASX to make gains.
Woodside Petroleum moved up 0.5 per cent and Caltex Australia moved up 1.7 per cent.
LendLease was the biggest name to present earnings on Monday, with earnings season winding down this week. The property group advanced 0.6 per cent. Among the day's best performers in the top 200 were lesser-known names Reliance Worldwide and Nanosonics, which jumped 8.9 per cent and 2.4 per cent, respectively.
As earnings season winds down, strategists are trying to get a handle on overall performance and in two important ways this has been the best reporting season in years.
First off, share prices are moving higher. This fact should be getting a lot more attention, JP Morgan Aussie equity strategist Jason Steed says.
"The improving momentum of results season is reflected in the fact that 123 stocks in the ASX 200 are up so far in August, which is the highest rate for five years," Mr Steed writes.
Credit Suisse strategist Hasan Tevfik has identified another under-reported but positive signal to emerge this month: top 200 companies have guided to higher capital expenditure for the year ahead for only the third reporting period since 2012, which coincides with the end of the mining boom.
Stock watch
Qantas
Qantas shares suffered a sharp reversal on Monday, dropping 5.7 per cent to $5.68 after JP Morgan analysts cut the stock to "underperform" from "neutral". The broker's analysts said they estimate the airline will need domestic fares to rise 10 per cent in perpetuity to justify the current share price, a prospect they said "seems optimistic to us". Qantas released its results late last week and "segmentally, Qantas domestic was a highlight," the analysts wrote. They added "the biggest disappointment for investors was likely the 36.1 per cent decline in earnings from Qantas International". Qantas has been a standout for investors this year – the stock ended 2016 trading at $3.33, making for a gain of 70 per cent in 2017.
Movers
Hurricane Harvey
Gasoline prices hit two-year highs on Monday as massive floods caused by Hurricane Harvey forced refineries across the US Gulf Coast to shut down. In crude oil markets, Brent futures, the global benchmark, were pushed up by pipeline blockades in Libya, but US crude futures eased. Spot prices for US gasoline futures surged 7 per cent to a peak of $US1.7799 per gallon, the highest level since late July 2015. About 22 per cent, or 379,000 barrels per day (bpd), of Gulf production was idled due to the storm, according to the US Bureau of Safety and Environmental Enforcement.
Euro
The euro extended its gains on Monday to reach a two-and-a-half-year high against the greenback, after the European Central Bank president over the weekend held back from talking down the currency and as markets worried about the impact of Tropical Storm Harvey on the US economy. The euro was 0.1 per cent higher at $1.1929 after rising to $1.1966, its highest since January 2015.The common currency had already surged about 1 per cent on Friday after ECB boss Mario Draghi did not touch upon the euro's recent strength at the Jackson Hole conference.
Wages trough
Consistently weaker-than-expected wage outcomes have been a "key driver" for the Reserve Bank of Australia's "persistent GDP downgrades and rate cut cycle," UBS economists say. But this phenomenon may be on the wane, as the UBS economists now see" more substantial reasons to finally 'call the trough' of wages growth". They note that wages growth "bounced" to 2.2 per cent over the June quarter, while better business conditions and a tighter labour market should see expansion in average earnings lift from record lows. Most important is the recent mandated increase in minimum wages, they say.
Wanda
Chinese conglomerate Dalian Wanda Group has said a report claiming its billionaire chairman, Wang Jianlin, was prevented from leaving the country was "groundless" and that it planned to take legal action. Taiwanese news site Bowen Press reported on the weekend that Mr Wang, who was with his family, was stopped from leaving Tianjin airport on Friday and had been detained for a few hours. Wanda, which has spent billions buying entertainment and sports companies in recent years, has become a target in China's clampdown on capital outflows.