Aussie shares are off to a flat start on Monday following their first weekly gain in a month. This is a decent performance considering US equities slumped by more than 2 per cent on Friday due to sluggish jobs growth and escalating China/US trade tensions.
Keep in mind that Australian shares are still near their worst levels in six months and this remains the worst start to a year since 2008. The market remains volatile and investors are lacking enthusiasm in their buying.
Across the market, mining stocks are doing most of the damage on Monday with losses from BHP Billiton (BHP), Rio Tinto (RIO) and Fortescue Metals (FMG) in negative territory.
Iron ore miner Atlas (AGO) is lifting by more than 40 per cent on news Mineral Resources (MIN) has agreed to buy the company in a deal worth ~$270m. Under the proposal, AGO shareholders will receive 1 new share in MIN for each 571 AGO shares they own. This represents a 59 per cent premium to their value last week. AGO shareholders will have the opportunity to vote on the deal in July.
Billabong’s (BBG) proposed takeover by US private equity firm Oaktree Capital Management has received the green light from the Federal Court. Billabong shares will cease trading today while BBG shareholders will receive $1.05/share in cash in late April. Oaktree is making the purchase through its Boardriders sport apparel business which it controls.
Macquarie Atlas Roads (MQA) has agreed to internalise its management and will appoint a new CEO. MQA plans to remain managed by Macquarie for the next year and will change its name to Atlas Arteria.
Elders (ELD) has decided to sell some of its assets in Indonesia following a review which highlighted their poor performance. ELD hopes to complete the sale by June and its shares are up 1.5 per cent.
While data on the performance of construction in Australia last month is released today along with weekly petrol price data, this is not the type of economic news the market reacts to significantly.
China’s sharemarkets resume trade today following a long weekend.
1.9bn shares have changed hands so far today worth $1.7bn. 454 stocks are up, 552 down and 372 are flat.
Published by CommSec