Aussie shares are easing on Friday, with losses from telcos and miners providing the main weight on equity markets. The ASX 200 index is down 11pts or 0.18 per cent at lunch after hitting fresh decade highs on Thursday. Shares remain on track to record their best weekly gains since mid-June and have recouped last week’s falls which was partly influenced by the political uncertainty in Canberra.
US markets lost some ground overnight. Reports suggested President Trump is preparing to apply tariffs on US$200bn of Chinese goods. Keep in mind both the S&P500 and Nasdaq hit record highs for most of the week and US bourses will be closed on Monday for a long-weekend.
The telcos are the worst performers on Friday, slumping by more than 3 per cent. TPG Telecom (TPM) and Vodafone Australia surged yesterday however after agreeing to merge forming a $15bn company on the ASX. This would reduce the number of major players in Australia’s telecommunications industry to three (Telstra, Optus and TPG Telecom post merger). The deal still needs to receive shareholder, court and regulatory approval.
A consortium led by toll road operator Transurban (TCL) has won its bid to buy a majority stake in Sydney’s WestConnex project. The group has agreed to pay $9.3bn to buy 51 per cent of the motorway from the NSW government. TCL is in a trading halt as it aims to raise $4.2bn from investors to help pay for its portion of the deal (which will cost $4.1bn).
Mining stocks are losing ground at lunch with concerns of ongoing trade tensions between the US and China. Fortescue (FMG) is down 2.9 per cent and is trading ex-dividend for its 12c final dividend. BHP and Rio Tinto (RIO) will both trade exdividend within the next fortnight.
Harvey Norman (HVN) is down 3 per cent and has reported a 16.4 per cent slide in net profit for the year to $375.4m. This was at the lower end of Bloomberg consensus. The result was partly weighed down by a fall in the value of its property portfolio and while sales have jumped by 3.2 per cent over the past 12 months growth has been slower than competitors JB Hi-Fi and The Good Guys.
Data on activity levels in China’s manufacturing and services sectors both came in better than expected at 11am AEST. Both the ASX 200 and the Australian dollar bounced off intraday lows around the time the latest reads were released.
1.3bn shares have changed hands worth a well above average $3.6bn. 527 stocks are up, 514 down and 344 are flat.
Published by CommSec