Market Wrap: Aus shares hover to end flat

Market Reports

Defying negative leads the Australian share market opened higher but hovered in negative territory for most of the session before ending 0.1 per cent up. Equities clawed out of the red by the afternoon with the help of an encouraging preliminary read on China’s manufacturing activity.

The S&P/ASX 200 index added 4 points to finish at 4,133. On the futures market the SPI is 1 point lower.

Economic news

Chinese manufacturing output has grown at the fastest pace in nine months. The HSBC Flash China manufacturing purchasing managers index (PMI) increased to a five-month high of 49.5 in July from 48.2 in June. The read is still below 50 which separate expansion from contraction.

Company news

Shares in Billabong International Limited (ASX:BBG) surged to the day’s best performer after the surfwear retailer confirmed it has received another takeover offer from US private equity firm TPG Capital. The indicative, non-binding and conditional offer values Billabong at $695 million, 18 per cent down from TPG’s first offer in February. Shares in Billabong International surged 19.55 per cent to close at $1.31.

Shares in Navitas Limited (ASX:NVT) dropped to the worst performer after the education provider revealed a softening in new international student enrolment numbers. As a result Navitas advises new student enrolments for its Australian University Programs Division will fall from its previous guidance of up to 15 per cent to now an expected 2 per cent. Shares in Navitas dropped 9.68 per cent to close at $3.92.

Shares in Northern Iron Limited (ASX:NFE) advanced after the iron ore developer received a revised $518 million takeover offer from India's Aditya Birla Group.

Building material manufacturer and takeover target Alesco Corporation Limited (ASX:ALS) has swung to a full year loss of $13.9 million but affirmed a positive outlook for the next year.

Gold producer Resolute Mining Limited (ASX:RSG) has awarded mining services provider Ausdrill Limited (ASX:ASL) a $US540 million contract for its Syama Gold Project in West Africa.

Oil and gas explorer Oil Search Limited (ASX:OSH) has posted a 8.4 per cent drop in first half total crude and gas production but confirmed its full year production guidance. 

Best and worst performers

The best performing sector was Energy adding 91 points to close at 11,877.
The worst performing sector was Industrials, losing 31 points to close at 3,182 points.

The best performing stock in the S&PASX 200 was Billabong International Limited (ASX:BBG), surged 19.55 per cent to close at $1.31. Shares in Energy World Corporation Limited (ASX:EWC) and Mirabela Nickel Limited (ASX:MBN) also closed higher.

The worst performing stock was Navitas Limited (ASX:NVT), dropping 9.68 per cent to close at $3.92. Shares in Linc Energy Limited (ASX:LNC) and Intrepid Mines Limited (ASX:IAU) also closed lower.

IPOs

Atrum Coal NL (ASX:ATU) started trading today with an issue price of $0.20. The metallurgical coal explorer and producer opened and closed at $0.18.   

Commodities

Gold is trading at $US1,577 an ounce.
Light crude is $0.72 up at $US88.86 a barrel.

The Australian dollar

The Australian dollar is buying $US1.03.