Local shares commenced the final session of the week in a restrained manner after several sessions of solid gains. Most ASX sectors were lower at lunch, even though the index was posting modest gains. Banks continued to advance, in turn being the main driver of the broader market. Not for the first time this week, Telcos were the leading decliners followed by Energy names. 1.3 billion share were trade in the period to lunch, worth $2.5 billion. 462 stocks were higher, 610 were lower and 433 were flat.
The flat start was seen in positive light, considering that US and European markets fell overnight. US sharemarkets retreated on weaker economic news. The US-China trade dispute continued to feature among investor concerns, while a US Supreme Court ruling on state sales tax collection weighed on Amazon and other online retailers. The Dow Jones fell by 196 points or 0.8%. The S&P 500 index lost 0.6% and the Nasdaq fell by almost 69 points or 0.9%. European sharemarkets fell as Investors reacted nervously to the appointment of eurosceptics to key finance positions in the Italian cabinet. The STOXX600 index fell by 0.9%. The German Dax fell by 1.4% and the UK FTSE index lost 0.9%.
ANZ led the gains for the financials after announcing this morning that it will double the size of its share buyback. The current on-market share buyback, which started in January of this year, will be increased by a further $1.5 billion, to a total of $3 billion. It comes after the bank received around $1 billion from the proceeds of the first tranche of the sale of its Australian Life Insurance Business. A short time ago ANZ shares were at $28.61 for a gain of $0.76 or 2.7%
HT&E (HT1) shares were 3% or $0.07 higher after revealing that it had received a revised proposal from APN Outdoor Group (APO) to acquire HT&E’s out-of-home division, Adshel. The revised deal includes a cash consideration of $230 million and 54.1 million APO shares. The proposal is based on the 5 day volume average weighted price or VWAP of $5.73 for APO, shares prior to the announcement of the takeover proposal received from JC Decaux to acquire APO yesterday, which saw the shares rise 12% The proposal effectively values Adshel at $540 million. APO expects the acquisition to deliver high-single digit earnings. APO shares were at $6.45 for a loss of $0.11 or 1.7%. HT1 shares were at $2.44, for a gain of 8 cents or 3.4%.
Energy names were lower after oil prices fell ahead of the meeting of OPEC and non-OPEC oil ministers, which will be held on Friday European time. An agreement to lift output has been telegraphed ahead of the gathering, although uncertainty remains on the amount and timing of output increases. Santos (STO) was recently at $6.00 down 14 cents or 2.3%.
The AUD/USD is up slightly in early Asian trade near 0.7380 as it benefits from yesterday’s passage through the Australian parliament of the contentious legislation to cut personal income taxes. Overall, the tax cut can provide a modest boost to the economy. Taxes will be cut in three stages over a number of years.
Published by CommSec