The Australian sharemarket eked out a small gain in a choppy day of trade, stumbling around the 5400 level as investors proved reluctant to make major moves ahead of public holidays in the United States and Britain.
The ASX took its positive lead from Wall Street's Friday session after US Federal Reserve chair Janet Yellen said the central bank would "gradually and cautiously" lift interest rates in coming months. But a lack of conviction and volume in local markets kept a lid on local buying during Monday trade.
The S&P/ASX 200 ended trade up 2 points, or 0.04 per cent, at 5408, while the All Ordinaries closed up 4 points, or 0.07 per cent, at 5473.6.
Regional markets ended mostly positive and the Nikkei closed at a one month high on the back of a weaker yen and fuelled by talk that Prime Minister Shinzo Abe would postpone next year's planned sales tax hike.
Patersons economist Tony Farnham said ahead of Monday's US Memorial Day holiday and a bank holiday in the UK a relatively quiet session was to be expected.
"It'd be a brave person to made a big trade today," he said.
Peak Asset Management executive director Niv Dagan said the 5400 mark was a technical resistance level and with US interest rate rises looming and the end of financial year a month away, he said the market would likely remain range-bound.
"We feel the market is going to need to have a really strong positive catalyst whether from macro-economic data or an interest rate cut to break through [5400]," he said, noting trading volumes were at lows not seen since 2010.
Gold miners proved a victim of the US dollar's strength over the weekend, which also pushed the Australian dollar back below US72¢.
The precious metal fell through the $US1200-level for the first time in three months late on Monday, falling as low as $US1199.80 an ounce following nine straight days of selling.
Newcrest Mining fell 1.5 per cent to $18.82, Northern Star Resources fell 5.8 per cent to $4.20 and Evolution Mining slipped 3.9 per cent to $2.
Big miners also eased, BHP Billiton ended 0.7 per cent lower to $19.24, while Rio Tinto lost 0.1 per cent to $44.77. Materials was the weakest sector, down 0.7 per cent.
Oil and gas producers were among the strongest performers by market cap. Origin Energy rose 1.6 per cent to $5.78, Woodside Petroleum climbed 0.9 per cent to $28.07 and Santos added 0.9 per cent to $4.56.
It came after Citi issued a note saying the "writing is already on the wall" for Santos and Origin, noting LNG projects are poised to outperform market expectations. Liquefied Natural Gas was the day's best performing stocks, up 6.5 per cent to 58¢.
The banks were the biggest drag on the index on Monday. Commonwealth Bank of Australia fell 0.9 per cent to $78.18, ANZ Banking Group lose 0.6 per cent to $25.69, National Australia Bank lost 0.2 per cent to $27.25 and Westpac Banking Corporation fell 0.3 per cent to $30.88.
Mr Farnham said however the bank stocks have stabilised of late as fears of their ability to maintain dividends has subsided.
"It's the risk return thematic. Even if they fall a bit in price, if the dividends are reasonable, then investors are getting an OK return," he said.
Among the blue chips, Woolworths was the strongest performer by market cap. It rose 1.4 per cent to $22.39, while rival Wesfarmers added 0.8 per cent to $41.50, lifting the consumer staples sector up 0.8 per cent, the best performing sub-index for the day. Telstra shares closed unchanged at $5.67.
In company news, Pacific Equity Partners is in advanced talks to takeover Patties Foods, the pie maker revealed. The company's shares surged 17.8 per cent to $1.57 on the news.
Spotless shares rose 5.5 per cent to $1.15 after it flagged the sale of its laundries unit in a deal that could be worth more than $650 million.
Meanwhile, testing services provider ALS said its annual underlying profit dropped 27 per cent to $99 million, positng a statutory annual loss of $240.7 million mostly due to impairment charges in its oil and gas investments. It shares fell 7.1 per cent to $4.17, making it the day's worst performing stock.
