The S&P/ASX200 overcame an early rout to close almost flat, up 1.7 points, or 0.02 per cent, to 8,663.7, as the broader All Ordinaries rose 4.9 points, or 0.05 per cent, to 8,922.
"If you try and put the flows together today, it's been a continuation of the selling of bank stocks, potentially due to valuation reasons, and the flow of the big mining stocks has resumed again after taking a bit of a hit last week," IG Markets analyst Tony Sycamore told AAP.
"You've also got the expectation the Reserve Bank cuts interest rates here next week, so that provides a little bit of a cushion as well."
Six of 11 local sectors finished the day lower, with financials and energy stocks weighing on the bourse as they each lost 0.6 per cent.
All big four banks lost ground, led by a 1.6 per cent slip in ANZ's value, while CBA was the best performer with a 0.1 per cent fall to $174.93.
Shares in insurance giant QBE dropped two per cent to $22.45, despite investment group UBS predicting strong premium growth and a calmer earnings season in August compared to February.
The materials sector helped balance financial sector losses, pushing 1.2 per cent higher as stronger gold and iron ore prices supported major miners.
BHP and Fortescue gained 0.9 per cent and 1.4 per cent respectively, while goldminers Northern Star (up 5.6 per cent) and Vault Minerals (up 7.4 per cent) were the top-200's best performers.
Consumer staples stocks also had a positive day, up 1.2 per cent with help from Dan Murphy's owner Endeavour Group, which jumped more than three per cent after executive chair Ari Mervis stepped down.
Coles and Woolworths also notched gains of more than 1.3 per cent to $20.89 and $31.68 respectively.
The lull for energy stocks tracked with a slip in oil prices, pushing Woodside 1.3 per cent lower to $26.19 a share, but Santos capped its downside at 0.3 per cent after announcing a potential domestic gas supply deal with French gas giant ENGIE.
IT stocks fell 0.4 per cent, as sector giant WiseTech faded 1.7 per cent after completing its $US2.1 billion ($3.25 billion) acquisition of Texas-headquartered e2Open.
US-based tech firm Block was the top-200's worst performer, falling more than four per cent ahead of an earnings update later in the week.Â
The Australian dollar gained ground against the greenback to buy 64.81 US cents and was trading higher against most major currencies on Monday.
Looking ahead, earnings season is picking up pace with REA Group, AMP, News Corp, QBE, and Pinnacle Investment Management set to report.
ON THE ASX:
* The benchmark S&P/ASX200 index on Monday rose 1.7 points, or 0.02 per cent, to 8,663
* The broader All Ordinaries gained 4.9 points, or 0.05 per cent, to 8,922
CURRENCY SNAPSHOT:
One Australian dollar buys:
* 64.81 US cents, from 64.30 US cents on Friday.
* 95.68 Japanese yen, from 96.84 Japanese yen
* 65.02 euro cents, from 56.25 euro cents
* 48.80 British pence, from 48.70 British pence
* 109.60 NZ cents, from 109.44 NZ cents
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