The Australian share market is trading nearly flat, despite modest leads from Wall Street, as local investors remain cautious ahead of a likely rate hike by the US central bank later this month.
The benchmark S&P/ASX200 index was up 0.1 per cent within the first half hour of trade, with gains from miners offset by losses in consumer and healthcare stocks.
“We’ve had a reasonably good earnings season which met expectations, but there is no further reason to go higher,” Australian Stock Report head of research Chris Conway said.
“Our market trend will depend on how US markets perform – with the focus on the impending rate increase later this month, but also on Trump and his spending plans.”
On Friday, US stock indexes edged higher after a late wave of buying and a speech by Federal Reserve Chair Janet Yellen indicating the central bank will be prompt to increase borrowing costs.
The Dow Jones industrial average rose 0.01 per cent, while the S&P 500 index gained 0.1 per cent.
In the local market, mining shares led the gains, with BHP Billiton, Rio Tinto and Fortescue Metals trading two to three per cent higher.
The big four banks were mixed.
However, declines in consumer-focused stocks including REA Group, Tatts Group and TabCorp dragged on the market, while healthcare stocks including Cochlear and Primary Healthcare also weighed.
Shares in Navitas slumped more than 15 per cent to $4.21 after the education services provider said it expects earnings to fall by at least $12 million next financial year if the federal government reduces the number of regions where it is contracted to teach English to migrants.
Meanwhile, the Australian dollar is trading higher at 75.94 US cents, from 75.54 US cents on Friday.