The Australian stock market is heading for a weak opening today as US investors staged an interest rate cut snit on Friday and sent Wall Street lower on the day and week.
That was after the ASX closed last week slightly higher as a sell-off at the start of the week was matched by a recovery on Friday, sparked by hopes of cheap money stemming from a potential 0.50% Fed cut.
That size of the reduction will not happen, according to US reports on Friday (See Wall Street markets story), so the overnight trading on the ASX futures fell 28 points, pointing to a weak start when trading resumes this morning.
The ASX 200 Index closed the week 3.8 points, or 0.06%, higher at 6700.3 while the broader All Ordinaries eased 2.6 points to 6786.2.
Bank shares hardly moved over the week with the BAB doing best – the shares rose 1.25% with the news it had appointed Ross McEwan as its new CEO (he’s a former senior Commonwealth bank executive as well as the retiring CEO of RBS in the UK which he has returned to profit after it almost collapsed in the GFC and had to be bailed out by the UK government).
ANZ shares rose 0.4% but Westpac shares fell half a percent. CBA shares closed up 0.7%.
Gold miners did well last week as the price of the precious metal hit a six-year high in trading on Thursday in the US, fell and then jumped again Friday night to top the $US1,450 an ounce level for the second day in a row but then retreated.
Northern Star Resources added 16% to end the week at $13.47, Newcrest was up 4.1% to $33.15, Evolution Mining saw a 10.5% jump to $4.83, Saracen Mineral Holdings added 11.6% to $4.15, Regis Resources lifted 13.5% to $6.38, St Barbara closed up 13.4% at $3.55, and Resolute Mining shares surged 16% at $1.74.
Western Areas shares jumped 20.2% to $2.44 after its June quarter results met guidance metrics for 2018-19. It also said in the event of a successful acquisition of Kidman Resources by Wesfarmers, it would receive $33.1 million for its 17.4 million Kidman shares.
Elders starred with the shares up 19.9% at $7.26 after it announced it was acquiring Australian Independent Rural Retailers for $187 million and said it would fund the takeover through a $137 million equity raising at $5.55 a share and a retail issue of $79 million in new shares.
Shares in shipbuilder and defence contractor Austal rose 17.3% to $4.13 after it announced it expected 2019-20 earnings before interest and tax to be at least 14 percent higher than 2018-19.
AMP shares were hammered to new lows – dropping 16.5% to $1.80 after the Reserve Bank of New Zealand blocked the sale of its life insurance business to Resolution Life, forcing the bank to scrap its interim dividend.
Shares in CIMIC Group dropped 18.8% to $36.57 after weak first-half profits.
Woodside Petroleum shares fell on a weak half-year production update and a big fall in global oil prices. The shares lost 6.2% to $33.60. Shares in rival Santos fell 1.7% to $6.85 after releasing a more upbeat June half-year production and sales report which contained news of a looming “substantial” upgrade to its Dorado oil discovery offshore the northwest WA coast with Carnarvon Petroleum.
Despite that news from Santos Carnarvon shares fell 7.5% to 43 cents.