The Aussie market fell for a second straight day and briefly hit 1½- month lows, with the ASX 200 declining by 2 per cent or 141.2 points, to 6845.6. 10 sectors (of 11) and 178 stocks (of 200) finished in negative territory. The Mining sector (down 4.9 per cent) weighed the most, driven by a 7.6 per cent fall in shares of BHP Group (BHP). The Energy sector retreated for a second straight day after the price of oil eased overnight, and the Big 4 banks all fell by at least 0.8 per cent. The defensive Consumer Staple sector bucked the trend, rising 1 per cent.
In economic news, the Jobs and Skill Summit kicked off today. A key focus of the summit is on improving migration settings to support higher productivity and wages. The CoreLogic Home Value Index of national home prices was also released today. It showed that home prices fell by 1.6 per cent in August – the biggest monthly decline in 39½ years. The local Property sector shed 2.2 per cent today – its biggest decline in around 2 months.
In company news, BHP Group (BHP), the largest company on the Aussie sharemarket, shed 7.6 per cent (biggest decline since May 2020) after trading ex-dividend. It dragged the broader index down by 46.8 points and accounted for roughly 33 per cent of today’s decline. So far this week, BHP has fallen by 12.4 per cent and is on track to post its biggest weekly loss in over a year.
Rio Tinto (RIO) has reached an agreement with Turquoise Hill Resources, to acquire shares of Turquoise that it does not currently own, for approximately US$3.3 billion. The C$43 per-share cash offer is a 19 per cent premium to Turquoise Hill’s last closing price. TRQ previously rejected RIO’s earlier offer of US$2.7 billion. RIO shares fell by 2.1 per cent – its fourth straight decline.
Fisher & Paykel (FPH) announced that it entered into a sale & purchase agreement, to acquire a 105 hectare site in Auckland for NZ$275 million. The new site will be used to construct a second NZ campus, focused on research & development, and pilot manufacturing. The acquisition is still subject to approval by the Overseas Investment Office. FPH was amongst some of the best performing stocks today, after climbing by 0.9 per cent.
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In other economic news, overnight, inflation data for Eurozone was released. The data showed that cost of living pressures across Eurozone hit a record high of 9.1 per cent annually (survey: 9 percent). Energy had the highest annual inflation rate at 38.3 per cent, down slightly from the annual rate of 39.6 per cent recorded in July, when the European Central Bank hiked its interest rate by 50 basis points – its first rate hike in 11 years.
3.9bn shares were traded, worth $8.7bn. 419 stocks rose, 958 fell & 376 finished unchanged.
In the US tonight, Challenger job cuts is released with the ISM and S&P Global PMIs, unit labour costs, productivity, construction spending and weekly data on claims for unemployment insurance
Originally published by Divik Nigam – (Author), CommSec
