Following a sharp sell-off on Wall Street on Friday, the local sharemarket dipped to three-month lows, with the ASX 200 losing 105.3 points or 1.6 per cent, to 6469.4. 6 sectors and approximately 71 per cent of stocks in the ASX 200 lost ground. Tech stocks and the defensive Consumer Staples & Health Care sectors managed to finish in positive territory despite heavy losses across the Resource sectors. Stocks in the Financials space also contributed to today’s declines, after the sector finished with a 0.7 per cent decline.

A softer demand outlook for most commodities, triggered by a synchronised increase in interest rates, has catalysed a sell-off in the Resource sectors. The Energy sector (down 6.3 per cent) posted its biggest decline since March 2020 after the oil price hit an 8-month low on Friday. Oil producers Woodside Petroleum (WDS), Santos (STO) & Beach Energy (BPT) all declined by at least 5 per cent. A 5.3 per cent slip in the Mining sector also weighed on the market, with coal miners New Hope Corporation (NHC) and Whitehaven Coal (WHC) finishing amongst the worst performers of the session.

Elsewhere in currencies, the sterling swung to historic lows of US$1.0327 against the greenback. The heightened volatility in the pound comes after the United Kingdom vowed to press on with tax cuts – an expansionary fiscal policy which is at odds with the contractionary monetary policy stance (raising interest rates) most central banks around the world have adopted. Locally, the Aussie dollar hit a 2-year low of $US0.6483.

Amid a broader sell-off, Costa Group (CGC) fell by 14.2 per cent, in part due to a leadership announcement it released this morning. CGC announced the sudden departure of CEO & Managing Director, Sean Hallahan. Shares of CGC touched a 7-year low of $2.13 today.

Private hospital services provider Ramsay Health Care (RHC) hit a 2.5-year low of $56.10 after it announced that its discussions with a Consortium of financial investors led by KKR, ceased. The Consortium wished to acquire RHC, but on the 13th of September, RHC was notified that the Consortium was ‘not in a position to improve the terms’ of their acquisition proposal. This follows the Consortium’s ‘review of RHC’s FY22 result announcement’.

 

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Link Administration (LNK) has determined to pay a fully franked Special Dividend of 8 cents per share (in addition to the 3 cents per share paid in April 2022). LNK fell 7.9 per cent today, and is down 45.2 per cent so far this year. This comes after the proposed takeover offer by Dye & Durham was terminated.

Today, 4.5bn shares were traded, worth $8.8bn. 268 stocks rose, 1,217 fell & 316 finished unchanged.

Originally published by Divik Nigam – (Author), CommSec