The Australian sharemarket is off to a quiet start on Monday, with the ASX 200 down just 0.14 per cent to 6,757.6 as mining and tech stocks weigh on the index. This follows a mixed end to trade in the United States and softer commodity prices.
Mining stocks are losing ground following weakness in iron ore prices. Fortescue Metals (FMG) is down 4.2 per cent while Rio Tinto (RIO) is declining by 2.9 per cent and the more diversified BHP is slipping by 1.1 per cent. Iron ore prices slumped by ~5 per cent last week due to emergency restrictions implemented in a major steel producing hub in China to reduce higher levels of air pollution. FMG, BHP and RIO went ex-dividend earlier this month.
Technology stocks are following their US counterparts lower on Monday. Afterpay (APT) is down 3 per cent, with the buy-now-paylater company slipping for three consecutive weeks. Openpay (OPY) has entered the hospital segment with St John of God Health Care. A six-month initial launch has now commenced at three hospitals. OPY said this will allow ‘…patients to spread their hospital costs for elective surgery procedures across plans ranging from 2-12 months’.
Gold miners are mostly higher with Evolution (EVN) up 2.8 per cent and the larger Newcrest (NCM) up 1.5 per cent. EVN has agreed to acquire Canadian based gold miner Battle North Gold for C$343m. EVN will fund the purchase with a mixture of existing cash and credit facilities. Fortescue (FMG) has brought forward its target to achieve carbon neutrality by 2030, which is ten years earlier than its previous target. It expects to meet its goals partly through the development of green electricity, green hydrogen and green ammonia projects in Australia.
Asaleo Care (AHY), Chorus (CNU), GWA Group (GWA) and SG Fleet (SGF) are trading ex-dividend today. Spark Infrastructure (SKI) is set to pay eligible investors a 6.5c dividend today.
The S&P quarterly rebalance of the ASX 200 will take effect on March 22. Pilbara Minerals (PLS), Codan (CDA), Champion Iron (CIA), HUB24 (HUB), Nickel Mines (NIC) and Nuix (NIX) are additions to the index. Tassal (TGR), Service Stream (SSM), Smartgroup (SIQ), Sandfire (SFR), GWA and Bravura Solutions (BVS) will be removed.
Monday is the busiest day of the month for updates on China’s economy. Data on retail sales, production and investment will be released for January and February at ~1pm AEDT. The market is anticipating double-digit gains when compared to a year earlier due to China’s COVID lockdowns in January and February 2020.
Reserve Bank Governor Philip Lowe in a speech this morning reiterated that Australia has responded very well to the pandemic. However, while there has been a ‘quicker and stronger economic recovery than was expected’ Governor Lowe said it ‘…does not hide the fact that we still have a long way to go’; with the unemployment rate too high and inflation and wages ‘…both lower than we would like’.
3.6bn shares have changed hands so far worth $2.4bn, with 727 stocks up, 580 down and 360 unchanged.
Published by CommSec