The Aussie market is slightly weaker on Tuesday with the ASX 200 easing 2 points or 0.02% to 7246 around midday. The losses aren’t as severe as futures were suggesting before the market open.
This follows yesterday’s big fall of 155 points or 2.1% and heavy losses on Wall Street overnight as investor sentiment soured on concerns over the Chinese property market and property group Evergrande’s liquidity issues, while the US Federal Reserve is also meeting later this week to discuss monetary policy.
Losses at lunch are being led by financials with the major banks all in the red. National Bank (NAB) is the worst of the big four lenders as it drops 1.2%. The utilities sector is the other large decliner while IT, consumer staples and property trusts also fall.
Energy and materials are leading improvements despite weaker commodity prices overnight. Global oil prices fell ~2% overnight and base metals like copper and zinc saw similar losses. Iron ore slumped another 6.7% and is now trading at US$94 per tonne and sitting at 16 month lows. Major iron ore miners such as BHP Group (BHP) and Rio Tinto (RIO) are both rising 1.8% today but still remain near the lowest levels of the year. Fortescue Metals (FMG) is 2.7% higher but still at the lowest levels in over a year.
In company news, AusNet (AST) is in a trading halt as it prepares a response to receiving a rival takeover bid from APA Group (APA) for $2.60/share or ~$10 billion. AST jumped 19% yesterday after announcing it had received a proposed offer from Brookfield Asset Management of $2.50 per share or $9.6 billion. APA shares are down 4% so far.
Atlas Arteria (ALX) announced it will pay a distribution of 15.5 cents per security for the 6 months to 30 June 2021, in-line with guidance provided at its first half profit release in August. The payment date is expected to be October 5.
The Aussie dollar is slightly firmer this morning, buying 72.65 US cents. The RBA released its minutes from its most recent September meeting where it re-iterated rates will remain on hold until inflation is comfortably within its 2- 3% target range, likely to be in 2024 onwards.
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