What's Affecting Markets Today
Asian Markets Weaker
Asia-Pacific markets fell on Monday following U.S. President Biden’s withdrawal from the presidential race, endorsing Vice President Kamala Harris as the Democratic nominee. China’s central bank unexpectedly cut rates, lowering the 7-day reverse repurchase rate to 1.7% from 1.8%. The one-year and five-year loan prime rates were also trimmed by 10 basis points each to 3.35% and 3.85%, respectively, surprising markets. The PBOC will also reduce collateral requirements for its medium-term lending facility.
The Hang Seng index rose slightly before falling 0.2%, while the CSI 300 lost 0.72%. Japan’s Nikkei 225 fell 1%, and the Topix was down 0.9%. South Korea’s Kospi dropped 1.4%, with the Kosdaq losing 2.2%.
The recent global IT outage caused by a CrowdStrike update crash affected 8.5 million Windows devices, impacting CrowdStrike’s shares by 11%. Investors are anticipating GDP data from South Korea and the U.S., and inflation numbers from the U.S. and Singapore this week.
ASX Stocks
ASX 200 - 7931.7 (-0.50%)
Key Highlights:
The benchmark S&P/ASX 200 Index fell 0.8% or 63.6 points to 7908 at midday, following last week’s peak of 8000. The materials, energy, and real estate sectors experienced the steepest declines.
Miners faced significant pressure as copper posted its largest weekly loss since 2022, and iron ore prices continued to slump towards $US100 a tonne after a Chinese policy meeting failed to introduce additional stimulus to support metals demand. BHP shares dropped 0.9%, extending losses from their lowest closing price since 2022 on Friday. Fortescue Metals fell 1.5%, and Rio Tinto declined 0.7%.
South32 shares plummeted over 10% after expressing concerns about the viability of the Worsley alumina refinery due to stricter environmental approvals from the West Australian government, leading the company to record a $US389 million impairment.
Woodside Petroleum fell 3.2% after agreeing to purchase the Gulf Coast Driftwood LNG project near Lake Charles, Louisiana, for $US900 million. CEO Meg O’Neill stated the acquisition “positions Woodside to be a global LNG powerhouse.”
Conversely, Insignia Financial shares rose 3.4%. The company announced expectations that its net revenue margin and earnings before interest, tax, depreciation, and amortisation margin will exceed its upgraded financial year 2024 guidance. Underlying profit for FY24 is projected to be between $212 million and $218 million.
Leaders
IRE Iress Ltd (+9.77%)
SNZ Summerset Group Holdings Ltd (+8.89%)
IFL Insignia Financial Ltd (+5.88%)
PRN Perenti Ltd (+5.70%)
SNL Supply Network Ltd (+5.30%)
Laggards
DRO Droneshield Ltd (-21.43%)
S32 SOUTH32 Ltd (-12.57%)
NXL NUIX Ltd (-5.44%)
ERA Energy Resources of Australia Ltd (-5.26%)
SPR Spartan Resources Ltd (-5.26%)
