ASX falls, Miners drag, Mesoblast drops 5%: ASX down 0.5% at noon

Market Reports

by Lauren Evans

The Australian sharemarket is dragging lower this morning as miners weigh on the index. At noon, the S&P/ASX 200 is 0.5 per cent or 37.7 points lower at 7432.4. The SPI futures are pointing to a fall of 49 points.

All sectors are in the red except real estate investment trusts, edging 0.1 per cent higher, while materials are leading the decline, down 1.2 per cent. This is followed by technology, down 0.8 per cent cent, then communication services, down 0.7 per cent. 

Among materials weak performance, mining giants BHP (ASX:BHP) and Rio Tinto (ASX:RIO) are down 2.1 and 1.4 per cent on softer iron ore prices. Other big names are adding to the fall, with James Hardie (ASX:JHX) down 1.8 per cent and lithium miners Orocobre (ASX:ORE) and Pilbara Minerals (ASX:PLS) down 2.2 and 2.7 per cent. 

Despite Afterpay (ASX:APT) lifting higher at the open, shares fell 0.2 per cent at noon, while Zip Co (ASX:Z1P) is down 3.2 per cent. Tech stocks Xero (ASX:XRO) and Nearmap (ASX:NEA) are also down 1.7 and 3.9 per cent.

Mesoblast (ASX:MSB) is down 4.7 per cent, after soaring 12 per cent higher yesterday when announcing the results from a phase three trial of rexlemestrocel-L in treating chronic heart failure.

In headlines this morning, bio-tech company Imugene (ASX:IMU) is up 4.3 per cent, following its new clinical trial supply agreement to evaluate the safety and efficacy of Imugene’s HER-Vaxx, a therapeutic cancer vaccine for the treatment of gastric cancer.

To recap, major indexes around the globe were mixed with marginal gains or losses as they awaited bullish catalysts. Wall St digested Treasury Secretary Janet Yellen’s remarks on reasons for the inflation spike.

Local economic news

Today the Reserve Bank released the minutes of the board meeting from last month, following insight into the decision to discontinue the three-year bond yield target and trends around inflation. In considering the policy decision, members observed that the Australian economy was recovering after the interruption to growth caused by the Delta outbreak and was expected to bounce back quickly as restrictions are eased further.

The bank said that a further pick-up in underlying inflation was expected, but it would be only gradual. The bank's central forecast was for underlying inflation to reach the mid-point of the target range by the end of 2023. Wages growth remained subdued, but was expected to increase gradually as the labour market tightens.

The Board discussed three options for the yield target: to continue with the target of 10 basis points for the April 2024 bond; to adjust the target by raising the target yield or shortening its tenor, say, to a bond maturing in 2023; or to discontinue the yield target altogether. For more info, visit here. 
ANZ and Roy Morgan released the consumer confidence index this morning, which dropped 3 points to 106, as worries about inflation mount. Consumer confidence was down 3 points on the second weekend of November.

Consumer confidence is now below the 2021 weekly average of 108.2 and 0.6 points lower than the same week a year ago, November 14/15, 2020 (106.6). This is the first time consumer confidence has dropped below its level of a year ago for almost a year, since late November 2020.

Consumer confidence this week was down in NSW, Victoria, Western Australia, South Australia and Tasmania but the exception was Queensland which had a small increase. This week’s decrease was driven by Australian's becoming less confident about their personal financial situations compared to a year ago and their expected financial positions this time next year.

Company news

Bio-tech company Imugene (ASX: IMU) has announced a new clinical trial supply agreement to evaluate the safety and efficacy of Imugene’s HER-Vaxx, a therapeutic cancer vaccine for the treatment of gastric cancer.

Beach Energy (ASX:BPT) has appointed Anne-Marie Barbaro as acting chief financial officer (CFO) following the appointment of Morné Engelbrecht as the acting chief executive officer (CEO) earlier this month.  

Best and worst performers

The best-performing sector is Real Estate Investment Trusts, up 0.1 per cent. The worst-performing sector is Materials, down 1.2 per cent.

The best-performing stock in the S&P/ASX 200 is Virgin Money UK (ASX:VUK), trading 3.9 per cent higher at $3.19. It is followed by shares in Lifestyle Communities (ASX:LIC) and SCA Property Group (ASX:SCP).

The worst-performing stock in the S&P/ASX 200 is Mesoblast (ASX:MSB), trading 4.7 per cent lower at $1.81. It is followed by shares in Nearmap (ASX:NEA) and Zip Co (ASX:Z1P).

Commodities and the dollar

Gold is trading at US$1864.59 an ounce.
Iron ore is 0.7 per cent lower at US$89.15 a ton.
Iron ore futures are pointing to a fall of 0.5 per cent.
One Australian dollar is buying 73.52 US cents.

Investor event

The last event for the year is today with four companies presenting from financial services, wireless technology to pharmaceutical companies. Make your way to to reserve your free online spot.

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