The Australian share market has come off its lows and ended flat despite the Victorian Government announcing a wide-ranging shutdown of industry in Melbourne for six weeks in an attempt to control a second wave of coronavirus infections.
Victorian Premier Dan Andrews said all but essential businesses, including most retail, manufacturing and administration companies, would shut down in metropolitan Melbourne.
Businesses that are forced to close will be eligible for a $5,000 grant from the Victorian Government.
The ASX 200 index ended down just 2 points to 5,926, after falling by more than 1 per cent in the first hour of trade.
The All Ordinaries lost 4 points, or 0.1 per cent, to 6,054.
Big banks and financial firms slumped on worries about a flood of business insolvencies from the Victorian shutdown, and the increased risk of home loan defaults if the Victorian economy did not bounce back later this year.
The Commonwealth Bank fell 1.8 per cent to $69.93, ANZ lost 4.1 per cent to $17.22, NAB also dropped 4.1 per cent to $16.84 and Westpac fell 3.5 per cent to $16.49.
Debt collector Credit Corp Group lost 8.7 per cent to $17.33.
Construction firms fell, with the Victorian Government announcing most construction sites would close down or dramatically reduce activity, although essential sites could remain open with a scaled-down workforce.
NRW lost 7.9 per cent to $1.69.
Retailers lost ground as well amid news of the Victorian shutdown.
Myer fell 4.9 per cent to 19.5 cents, Harvey Norman was off 2.4 per cent, JB Hi-Fi was down 2.3 per cent and Wesfarmers (the owner of Bunnings and Officeworks) lost 1.4 per cent.
But supermarket chain Woolworths rose 0.9 per cent to $39.04.
However, a rally by healthcare firms and miners limited the losses, with China's manufacturing industry expanding again last month.
Gold miners jumped after gold reached new record highs of nearly $US1,990 an ounce. St Barbara rose 3.6 per cent to $3.47.
Hearing implant maker Cochlear rose 4.6 per cent to $198.89.
Petrol retailer Viva Energy jumped 5 per cent to $1.69 after saying petrol sales recovered across the country last month, aside from in Victoria, where they slumped by a quarter.
Mining contractor Monadelphous was the biggest loser in the ASX 200, down 10.3 per cent to $7.99, after it was sued by Rio Tinto over a fire at an iron ore processing plant last year.
The Australian dollar was down 0.3 per cent to 71.21 US cents.
Job ads rise but at a slower pace
The latest survey from ANZ shows that job ads jumped strongly for the second month in a row in July, but the pace of gains slowed down as Melbourne reimposed restrictions because of the second wave of coronavirus infections.
Job openings increased 16.7 per cent over the month as most of Australia's economy continued reopening, following a 41.4 per cent surge in June.
But advertisements are still down a third since February and by a similar amount over the year to July.
ANZ economists said the new lockdown in Victoria worsens the outlook.
"We think additional fiscal measures will be needed sooner rather than later to support households, workers and businesses through this very tough period," they argued.
Job ads fell by a record 53.7 per cent in April amid government restrictions and business shutdowns because of the pandemic.
Company reporting season underway
The company-reporting season gets into full swing this week, with expectations that some big companies could see annual earnings plunge by up to 20 per cent because of the coronavirus pandemic.
Later this week, Insurance Australia Group and real estate firm REA Group will report their annual profits.
The Australian market fell 2 per cent on Friday amid rising coronavirus infections in Victoria and after the US economy saw its worst June quarter on record because of COVID-19.
On Friday, Wall Street ended higher in a volatile session, despite no deal in Congress to extend extra unemployment benefits for millions of Americans.
The Nasdaq rose after COVID-19 boosted the earnings of tech giants such as Apple and Amazon.
Apple shares jumped 10.5 per cent to end at a record high of $US425.04 after the company's quarterly results. It has surpassed Saudi Arabian oil giant Aramco as the world's most valuable publicly traded company.
The Dow Jones Industrial Average rose 115 points, or 0.4 per cent, to 26,428, the S&P 500 gained 25 points, or 0.8 per cent, to 3,271 and the Nasdaq Composite added 157 points, or 1.5 per cent, to 10,745.
The Australian dollar slipped from a 15-month high to around 71.3 US cents.
