• The Aussie sharemarket wiped out gains of around 1.1 per cent and finished near session lows, after the ASX 200 shed 0.15 per cent or 9.9 pts to 6591.1. The strong start shadowed the performance of US markets, which surged after the US Federal Reserve increased its Federal Funds target rate by an expected 75 basis points – the largest increase in around 28 years. Of the 11 sectors, 4 finished in positive territory, with the Real Estate sector lifting most.
• In economic news, the US Federal Reserve hiked its Federal Funds target rate by 75 basis points this morning. This is the largest interest rate hike in 28 years, and follows hotter-than-expected inflation data released last Friday.
• The Aussie economy added 60,600 jobs in May according to a monthly labour market update, considerably higher than the 25,000 expected. All jobs added were full time. While the unemployment rate increased by 0.04 percentage points to 3.90 per cent, it remained near a 48-year low. The rise in the jobless rate comes as more individuals join the workforce.
• In company news today, Link Administration Holdings’s (LNK) subsidiary, Link Fund Solutions Limited ‘has been notified by Harcus Parker and Leigh Day that an application for a Group Litigation Order has been filed in the English High Court’. LNK also notified shareholders that the Australian Competition & Consumer Commission (ACCC) ‘outlined significant preliminary competition concerns with Dye & Durham’s (D&D) proposed acquisition of LNK. The ACCC says that the ‘potential vertical integration of D&D’s operations and PEXA’ (PXA) gives rise to the competition concerns. LNK was the worst performer today after falling by 10.4 per cent today.
Top Australian Brokers
• Eagers Automotive (APE) will conduct an on-market share buyback of up to 10% of its issued share capital. The buy-back reflects the ‘Board’s prudent focus on active capital management’ and will commence on 30 June 2022. APE rose 5.4 per cent.
• Flight Centre (FLT) will invest over $30m in a bid to retain staff. Around 10k of its sales & support staff are expected to receive either additional share rights (~$3750) in the company or cash in some instances.
• The Reject Shop (TRS) has appointed Phillip Bishop as its new CEO, effective 11 July 2022. TRS is also considering an onmarket share buy-back. Its Board is expected to make a decision by August. Shares finished 19 per cent higher.
• 4.5bn shares were traded worth $10.6bn. 898 stocks rose, 583 fell & 390 finished unchanged.
• In the US, jobless claims and housing data are released with the Philadelphia Fed manufacturing index. The Bank of England hands down its interest rate decision, with the market currently pricing in at least a 25bps hike.
Published by CommSec,Divik Nigam – (Author)