The Australian share market has edged higher, with the energy and mining sectors rebounding and the banks and tech companies losing ground ahead of Tuesday's likely rate hike.
After being down by six points in the first 40 minutes of trading, the benchmark S&P/ASX200 index on Monday finished up 23.5 points at 6852.2, a gain of 0.34 per cent.
The broader All Ordinaries rose 18.2 points to 7074.5, a 0.26 per cent increase.
"We were expecting today's market to be weaker given the US leads, and it started a lot weaker. But it did recover," said Jun Bei Liu, Alpha Plus Fund portfolio manager with Tribeca Investment Partners.
"It does seem like there is buying, to support the market. It's probably on the back of a pretty good reporting season as well, and a reasonable outlook.
"So I think the market fundamentals look pretty good."
The mining sector gained 1.9 per cent after falling 10.3 per cent last week, its worst weekly performance since the start of the pandemic.
BHP gained 3.2 per cent to $37.91 and Rio Tinto rose 1.8 per cent to $81.77, but Fortescue Metals, trading ex-dividend, dropped 4.6 per cent to $16.41.
The energy sector rose 4.0 per cent, with strong gains for coalminers after Russia indefinitely shut down gas flows to Germany via the Nord Stream 1 pipeline.
Whitehaven Coal added 6.5 per cent to hit a record closing high of $8.49, while New Hope gained 5.7 per cent to a more than 10-year high of $5.39 and Terracom advanced 6.5 per cent to 99c.
"There's so many energy shortages around the world, and coal is something where it's difficult to restart some of these options, given the ESG concerns," Ms Bei Liu told AAP, referring to environmental, social and governance.
"There's constrained supply, and demand is incredibly strong, and we're heading into the colder season now, in North America."
Elsewhere in the energy sector, Woodside rose 4.3 per cent to $35.97, Ampol added 3.1 per cent to $32.98 and Beach Energy rose 5.2 per cent to $1.725.
Also, Santos was up 3.1 per cent to $7.97 after the Adelaide-based oil and gas producer was awarded permits to pursue carbon dioxide storage opportunities at its drilling operations off the coast of WA.
The big retail banks were lower in advance of the Reserve Bank's meeting on Tuesday afternoon, where it is widely expected to raise rates by another 50 basis points to 2.35 per cent.
NAB fell by 0.7 per cent to $30.34, Westpac fell by 0.2 per cent to $21.35 and ANZ and CBA were down by 0.5 per cent to $22.63 and $96.51, respectively.
Investment bank Macquarie, however, gained 1.2 per cent to $179.35.
Several companies gained ground after S&P Dow Jones Indices announced late on Friday it would be added to the ASX200 index in two weeks, meaning that managers of index funds will have to add them to their portfolio.
Fast-fashion jewellery retailer Lovisa gained 4.0 per cent to an all-time high of $22.96. Melbourne-headquartered offshore Brazilian oil producer Karoon Energy added 2.9 per cent and salary packaging company Smartgroup rose 1.9 per cent.
On the flip side, family tracking app Life360, buy now, pay later company Zip Co and sports wagering operator Pointsbet Holdings were all down from 4.1 to 6.4 per cent after S&P said they'd be removed from the ASX200 to make way for the new entrants.
The Australian dollar, meanwhile, had hit a fresh six-week low against the greenback. It was buying 67.81 US cents, from 67.98 US cents at Friday's close.
ON THE ASX:
* The benchmark S&P/ASX200 index on Monday finished 23.5 points higher at 6852.2, a 0.34 per cent gain.
* The broader All Ordinaries rose 18.2 points, or 0.26 per cent, to 7074.5.
One Australian dollar buys:
* 67.81 US cents, from 67.98 US cents at Friday close
* 95.23 Japanese yen, from 95.34 yen
* 68.48 Euro cents, from 68.03 cents
* 58.13 British pence, from 58.79 pence
* 111.35 NZ cents, from 111.83 cents.