McMillan red lights Eclipx buy on disappointing results, ECX falls 54%: Aus shares 0.3% lower at noon

Market Reports

by Jessica Amir

Following a subdued session on Wall Street with trade concerns returning to US equity traders, the Australian share market fell into the red at the open, while three top 200 companies shares have fallen over 10 per cent and are capping gains, with New Hope (ASX:NHC) continuing to see sharp selling for the second day after releasing its results with gains across all key metrics, while Platinum Asset Management (ASX:PTM) has fallen over 10 per cnet and Eclipx Group (ASX: ECX) shares hit an all-time low tumbling 54 per cent.

It comes as multinational salary packaging firm McMillan Shakespeare (ASX:MMS) says does it's not in the best interest of shareholders to potentially purchase Eclipx Group (ASX:ECX). McMillan Shakespeare noted several issues for this, one of which was Eclipx Group reporting a 42.4 per cent fall in its profits net profit after tax and before amortisation (NPATA) despite the company expecting single-digit growth in FY19 compared to FY18.

The S&P/ASX 200 index is 18 points or 0.3 per cent lower at 6,167. On the futures market the SPI is 15 points lower.

Local economic news

The Australian Prudential Regulation Authority (APRA) will increase its scrutiny of how banks, insurers and superannuation trustees are managing the financial risks of climate change to their businesses.

After conducting its first climate risk survey, the body is calling on large banks to take action, instead of just gaining awareness of the risks to their businesses. It comes as APRA surveyed 38 large banks, insurers and superannuation trustees on climate-related risks and it found the majority of banks considering climate-related financial risks as part of their risk management frameworks.

Company news

Agricultural chemical company Nufarm (ASX:NUF) announced its headline HY2018 profit swung 214 per cent down to a net loss of $13.6 million on the back of a challenging half year to 31 January 2019. The company says Australia and Europe were hit with dry weather, which impacted earnings in both regions, while product availability issues further impacted results in Europe. Its underlying earnings before interest, tax, depreciation and amortisation (EBITDA) fell 2 per cent on the prior corresponding period to $120.9 million. Shares in Nufarm (ASX:NUF) are trading 16.37 per cent lower at $4.64 at noon.

Esteemed fund manager, Platinum Asset Management (ASX:PTM) advised Kerr Neilson, co-founder and controller is selling down his and his Mrs Judith Neilson’s 60 million shares in the company, which equates to 10 per cent of the issued shares. The off-market bookbuild sale at $5 per share to institutional investors took place on 19 March 2019. After the off-market controlling sale, Kerr retains 42.97 per cent. Kerr says reducing their holdings after 25 years allows the duo to direct capital towards other pursuits, ‘particularly those that relate to the arts and philanthropy, as well as diversifying our personal investments’. Platinum Asset Management (ASX:PTM) shares as a a result are trading at multi-year lows falling 10.2 per cent to $4.94 at noon. 

Best and worst performers

The best-performing sector is S&P/ASX Utilities, adding 0.8 per cent, while the worst performing sector is S&P/ASX Materials, shedding 1.2 per cent.

The best performing stock in the S&P/ASX 200 is Corporate Travel Management (ASX:CTD), rising 4.5 per cent to $25.40, followed by shares in Mcmillan Shakespeare (ASX:MMS) (after it's not proceeding with the Eclipx Group (ASX:ECX) transaction), followed by Orica Limited (ASX:ORI).

The worst performing stock in the S&P/ASX 200 is Eclipx Group (ASX:ECX), dropping 54.1 per cent to $0.00, followed by shares in Nufarm (ASX:NUF) and New Hope Corporation (ASX:NHC).

Commodities and the dollar

Gold is trading at US$1,305 an ounce.
Iron ore price fell 1.2 per cent to US$87.23
Iron ore futures are pointing to a fall of 4.5 per cent.
One Australian dollar is buying 70.64 US cents.

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