The local share market has finished little changed from where it started, with strong gains by energy producers balanced in part by losses from lithium miners.
The benchmark S&P/ASX200 index on Monday finished down by 2.0 points, 0.03 per cent, to 7,496.3, while the broader All Ordinaries dipped by less than half a point, to 7,730.1.
With Wall Street set to be closed on Monday for the Martin Luther King Day holiday, there wasn't a strong impetus for the local bourse.
But over the weekend an unexpected drop in US producer prices for December was another indication inflation is cooling and the Federal Reserve would begin cutting interest rates sooner rather than later.
But in the Red Sea, the Houthi militia was vowing a "strong and effective response" after the United States carried out another strike in Yemen, adding to fears the conflict might escalate into a regional war.
The energy sector was the ASX's biggest mover on Monday, climbing 2.1 per cent on the Middle East tension as well as the ongoing rally in uranium prices and a legal victory by Santos.
Woodside gained 1.1 per cent to a six-week high of $31.63, Ampol added 2.4 per cent to $36.33 and Santos climbed 3.7 per cent to a two month high of $7.83 after the Federal Court dismissed a group of Tiwi Islanders' challenge to its Barossa gas pipeline in the Timor Sea, clearing the gas giant to resume work on the $5.7 billion project.
Uranium companies were going nuclear, boosted in part by the Biden Administration's announcement last week of a US$500 million program to jump-start the domestic industry.
Boss Energy finished up 9.6 per cent, Deep Yellow soared 11.6 per cent, Energy Resources rocketed 34.1 per cent and Peninsula Energy ascended 23.8 per cent.
On the flip side, the heavyweight mining sector dropped 0.8 per cent, with the once-red hot lithium miners continuing their slide.
Pilbara fell 4.8 per cent, IGO and Arcadium both dropped 5.8 per cent and Mineral Resources dipped 3.0 per cent.
The iron ore giants were also lower, with BHP dropping 1.1 per cent to $47.18, Fortescue falling 0.5 per cent to $27.24 and Rio Tinto retreating 0.6 per cent to $127.32.
The Big Four banks had a fairly quiet day, with CBA flat at $113.66, NAB up 0.1 per cent to $30.95, ANZ adding 0.2 per cent to $25.95 and Westpac climbing 0.4 per cent to $23.29.
Consumer discretionary retailers did well after the company that owns Rebel Sport, Macpac and Supercheap Auto said that despite rising cost-of-living pressures, its first-half sales were up 3.0 per cent for the 26 weeks to December 30.
"Well-executed promotions during peak end-of-year trade have delivered revenue growth that has translated into strong first-half earnings," Super Retail Group chief executive and managing director Anthony Heraghty said.
Super Retail Group rose 5.7 per cent to an all-time high of $16.71, while JB Hi-Fi added 3.5 per cent to an all-time high of $59.88 and Peter Alexander owner Premier Investments climbed 4.0 per cent to $27.80.
Myer, Kathmandu owner KMD Brands, Baby Bunting and City Chic Collective all rose as well, by between 2.2 and 4.1 per cent.
The Australian dollar was buying 66.87 US cents, from 67.02 US cents at Friday's ASX close.
ON THE ASX:
* The benchmark S&P/ASX200 index on Monday dropped 2.0 points, or 0.03 per cent, at 7,496.3
* The broader All Ordinaries fell four-tenths of a point, to 7,730.1
CURRENCY SNAPSHOT:
One Australian dollar buys:
* 66.87 US cents, from 67.02 US cents at Friday's ASX close
* 97.11 Japanese yen, from 97.27 Japanese yen
* 60.99 Euro cents, from 61.05 Euro cents
* 52.42 British pence, from 52.46 pence
* 107.40 NZ cents, from 107.35 NZ cents
