Peace deal inked: Aus shares close 0.51% lower

Market Reports

by Jessica Amir

The Australian share market erased this week’s gains from our shorted week. We had muted gains from Wall Street overnight after President Donald Trump and North Korea leader Kim Jong Un signed an agreement to establish a "peace regime" on the Korean peninsula.

Only two Australian sectors made gains today, with utilities shining over 8 per cent higher, and industrials which added just 0.1 per cent

Materials and energy stocks continued to hold us back throughout the session, after oil prices fell, with the likes of Beach Energy (ASX:BPT) losing over 2 cent and miners also losing steam after metal prices and the iron ore price didn’t see much movement, with the iron ore price gaining 0.7 per cent to US$67.23 overnight, but and its futures are pointing to slight rise of 0.1 per cent.

As for the heavyweights, Fortescue (ASX:FMG) slipped 1.9 per cent, with BHP (ASX:BHP) losing 1.3 per cent and Rio (ASX:RIO) following. 

At the closing bell, the S&P/ASX 200 index closed 31 points lower, or 0.51 per cent lower, to finish at 6023.50 points.

Futures market

The Dow Jones Futures are suggesting a rise of 38 points.
The S&P/ASX 200 Futures are suggesting a fall of 33 points.

Value of trades

The value of trade was $5.3 billion on volume of 711 million shares at the close of trade. The top three stocks by value were Commonwealth Bank of Australia (ASX:CBA), BHP Billiton (ASX:BHP) and Westpac Banking Corporation (ASX:WBC).

Economic news

RBA Governor, Philip Lowe gave a speech on productivity and wages at the Australian Industry Group in Melbourne noting GDP rose by 3.1 per cent, stronger than it expected for the year. He mentioned the ongoing rise in investment, non-mining business investment jumping by 10 per cent over the past year. The highest level in many years on the back of infrastructure spending, from investments in transport and renewable energy.

The Governor also mentioned there was still spare capacity in the labour market and that Australia could do better as the unemployment rate has been around 5½ per cent for a year now.

Company news

A CIMIC Group (ASX:CIM) led consortium is leading the pack as the preferred party for designing and constructing a NZ prison project worth NZ$750 million. The NZ government has nominated CIMIC as the preferred party to deliver the Waikeria Corrections and Treatment Facility Public Private Partnership (PPP) project. CIMIC is delivering the majority of the works and commercial arrangements are also almost finalised, with revenue expected to be received in the third quarter of 2018. Shares in CIMIC Group (ASX:CIM) closed 3.06 per cent lower at $40.50.

APA Group (ASX:APA) jumped up a massive 20.92 per cent after receiving a $13 billion takeover offer at $11 per share. The unsolicited takeover offer is from a consortium, led by Hong Kong’s CKI Group.

Gateway Lifestyle Group (ASX:GTY) announced it has received a $635 million takeover offer from Hometown Australia Holdings and Hometown America Communities, to buy the company at $2.10 per security. The offer is confidential, indicative and non-binding.

Medical dermatology company Botanix (ASX:BOT) has announced that it has received Australian approval for a phase 2 acne study. The Australian approval comes off the back of approval from the US Food and Drug Administration. 

Pilbara Minerals (ASX:PLS) announced the commissioning of its flagship lithium-tantalum project, Pilgangoora in WA is underway. It comes as construction and power distribution is largely complete, putting the company on track to achieve first production of concentrate by the end of June. 

ASX top 300 lithium company, Global Geoscience (ASX:GSC) has entered into a trading halt after it announced plans to raise $53 million from an institutional placement at 41 cents. The monies will be used to fully fund its Rhyolite Ridge Lithium-Boron project in Nevada, through to a mine development decision by late 2019.

IPOs

Telecommunications provider, Vonex Limited (ASX:VN8) started trading today it issued shares at $0.13, opened at $0.13 and closed at $0.17.

Best and worst performers of the day

The best-performing sector was Utilities, which added 8.22 per cent. The worst-performing sector was Materials, which shed 1.18 per cent.

The best-performing stock in the S&P/ASX 200 was APA Group (ASX:APA), which rose 20.92 per cent to $10.00. Shares in Gateway Lifestyle (ASX:GTY) and Metcash Limited (ASX:MTS) followed higher.

The worst-performing stock in the S&P/ASX 200 was Bellamy's Australia (ASX:BAL), which fell 6.57 per cent to $16.35. Shares in Mineral Resources. (ASX:MIN) and Wisetech Global Ltd (ASX:WTC) followed lower.

Asian markets

Japan's Nikkei has gained 0.42 per cent, Hong Kong's Hang Seng has lost 0.56 per cent and China's Shanghai Composite has lost 0.57 per cent.

Commodities and the dollar

Gold is trading at USD $1295.56 an ounce.
Light crude is trading $0.13 lower at USD $65.90 a barrel.
One Australian dollar is buying 75.70 US cents.

Cryptocurrencies

Bitcoin is trading 3.92 per cent lower at USD $6603.42, Ethereum is trading 6.92 per cent lower at USD $496.20 and EOS is trading 9.08 per cent lower at USD $10.25.