Aussie shares are falling heavily on Friday following a weak lead from Wall Street and rising US-China trade tensions. The ASX 200 is down by 1 per cent to 6,031pts, which means all this week’s gains have been wiped out in one fell swoop. The good news is that the index is only down by ~0.1 per cent over the past five days, which means there is still a chance the market could eke out small gains should we bounce off the lows this afternoon. Also with one week left this month, the market is still up by ~2 per cent in July and is on track to lift for a fourth straight month.
US markets fell by 1.2 per cent overnight, due to heavy losses from tech heavyweights Apple and Microsoft. Both companies are set to post quarterly results next week. Each company’s market capitalisation is equivalent to the size of the whole Australian sharemarket.
Locally, all sectors are losing ground at lunch, with technology, property trusts and healthcare the hardest hit. Retailers and banks are also falling back by ~1 per cent.
Vicinity Centres (VCX) is down by 2 per cent after the owner of 60 shopping centres announced an 11.3 per cent or $1.8bn decline in the value of its assets, which has been blamed on COVID-19. Due to the pandemic, VCX has also been impacted by waivers and rent deferrals for tenancies across its shopping centres.
IAG – the group behind NRMA insurance – has flagged it will not pay shareholders a final dividend in 2020. IAG has paid a final dividend over the past 19 years. IAG expects gross written premium growth of ~1 per cent for the year ended 30 June 2020 and an insurance margin of ~10 per cent (prior guidance 12.5 – 14.5 per cent). It has been impacted by higher reinsurance costs, lower investment returns, the deterioration in performance of some of its Australian commercial portfolios, severe natural peril activity (e.g. bushfires) and the COVID-19 pandemic.
City Chic (CCX) has entered a trading halt as it seeks to raise up to $90m from investors to help pay for the online assets of US based plus-sized brand, Catherines. Catherines’ parent company has filed for bankruptcy and will close its 300 stores network. However, the company made US$70m in online sales over the 12 months to April 2020.
Spanish company, Iberdrola has announced an increased 92c per share takeover offer for Australian renewables company, Infigen (IFN). The IFN Board is unanimously recommending shareholders accept the revised offer. Shares in IFN are up just 0.3 per cent to $0.9225 (around the takeover price), but has surged by 42 per cent Year-to-Date. Most of the improvements were recorded in January, April and June.
2.9bn shares have changed hands so far, worth $2.6bn. 473 stocks are up, 627 are down and 357 are unchanged.
Published by CommSec