Issue can be reproducable by using reporting DB name with '-' in.
In this case the reporting DB name was SCOM-Reporting.
You can also test it by creating a DB with ABC-XYZ name and run the following SQL
query:
ALTER DATABASE ABC-XYZ SET AUTO_CLOSE OFF WITH NO_WAIT
This query will only wirg if you put DB name in [] (Square brackets)
ALTER DATABASE
ABC-XYZ SET AUTO_CLOSE OFF WITH NO_WAIT
but in the SCOM setup files that SQL string doesnt contain [] for DB name
Use the Reporting DB name that doesnt contain and special characters.
Means
WRONG = SCOM-REPROTING
CORRECT = SCOMREPORTING