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Despite spending much of the first hour in the red, the ASX 200 has picked up and is now back in positive territory around lunch. The benchmark index was down 12 points at its lows and 15 points higher at its best, it is now trading 4 points or 0.07% higher at 6,551 around midday and lifting for a fifth session in a row.

With Friday’s gains, the Aussie market is also looking on track for another weekly improvement. The ASX 200 index is up ~2.4%, the third week of improvements in a row.

Today, the IT and healthcare sectors are leading improvements with most sector trading higher. The
resources sectors are underperforming most as energy and materials both ease.

A number of the smaller listed health stocks are seeing the biggest moves. Aged care providers are soaring after Regis Healthcare (REG) received and has rejected an unsolicited takeover approach by investment firm Washington H Soul Pattinson (SOL) for $1.85/share, valuing REG at ~$556 million. REG board members rejected the offer as it believes it undervalues the company. REG shares have leapt 19% while other aged care providers have also lifted. Japara Healthcare (JHC) is 21% higher while Estia Health (EHE) has gained 17%.

Mesoblast (MSB) is another health stocks to outperform with a gain of 14%.The biopharmaceutical firm has entered into an agreement with Novartis for the development, manufacture and commercialisation of its remestemcel-L therapy with an initial focus on the treatment of acute respiratory distress syndrome (ARDS) associated with COVID-19.

Elsewhere, Insurance Australia Group (IAG) remains in a trading halt but announced it will raise $750 million in response to the NSW Court of Appeals decision on business interruptions associated with COVID-19. IAG intends to recognise a post-tax provision of $865 million due to the court’s decision.

Australia’s preliminary October retail sales increased 1.6% on September with the easing of Victorian restrictions assisting the lift in spending, with the state leading sales growth for the month. Annual growth rose to 7.3% on the year before. The Aussie dollar is slightly weaker and buys 72.78 US cents.

Published by CommSec