ASX 4-week low, housing slow-down effects FBU: Aus shares 0.8% lower at noon

Market Reports

by Jessica Amir

The Australian share market continued its fall hitting a four-week low, at 5,635 points earlier in the session, a level the local bourse hit on 26 October, with most sectors trading lower.

The S&P/ASX 200 index is 0.8 per cent or 44 points lower at 5,650, on the futures market the SPI is 39 points lower.

Economic news

RBA Minutes from the November 2018 Monetary Policy Meeting highlighted that the labour market has been stronger than expected, inflation is returning to the midpoint of its target and that housing borrowing and markets continue to ease on the back of tighter credit conditions. Just some of the reasons the RBA kept interest rates on hold at 1.5 per cent, with inflation being at 1.9 per cent and the Australia dollar hovering around 73.00 US cents.

Company news

Coles Group is officially its own company after Wesfarmers (ASX:WES) announced the demerger is effective. It comes as Supreme Court orders were lodged with the Australian Securities and Investments Commission. Coles will begin trading tomorrow with WES to retain a 15 per cent take in the new listed entity and it will take a 50 per cent holding in Flybuys. Each WES shareholder will receive 1 new Coles share. UBS expects WES will now have more volatile cash flows and that the company will trade at a discount post-merger and Coles. Citi expected Coles should be valued at $14.20 per share Shares in Wesfarmers (ASX:WES) are trading 0.1 per cent lower at $43.81 at noon.

Enterprise software (software as a service (Saas)) company, Technology One (ASX:TNE) announced its ninth consecutive year of record profit and revenues with its net profit after tax rising 15 per cent to $66.5 million for the year ending 30 September 2018. Technology One (ASX:TNE) shares are trading 0.5 per cent lower at $5.71 at noon.

One of largest listed NZ companies, Fletcher Building (ASX:FBU) has seen its shares in Australia fall to a six-year low, after announcing its first half earnings (EBIT) for FY19 will be 10 per cent lower than its first half 2018. Its full 2019 EBIT, before significant items, should now sit between $630 to $680 million. It comes on the back of the Australian residential market slowing down and a reduction in land development. It's trading 8.9 per cent lower at $4.72 at noon. 

Best and worst performers

The best performing sector is S&P/ASX Real Estate Investment Trusts adding 0.1 per cent, while the worst performing sector is S&P/ASX Health Care, gaining 1.7 per cent.

The best performing stock in the S&P/ASX 200 is Saracen Mineral Holdings (ASX:SAR), rising 4.8 per cent to $2.64, followed by shares in ALS (ASX:ALQ) and The A2 Milk Company (ASX:A2M).

The worst performing stock in the S&P/ASX 200 is Fletcher Building (ASX:FBU), dropping 8.9 per cent to $4.72, followed by shares in Altium (ASX:ALU) and Orocobre (ASX:ORE).

Commodities and the dollar

Gold is trading at US$1,223 an ounce.
Iron ore price rose 1.1 per cent to US$76.11 and its futures are pointing to a rise of 0.5 per cent.
One Australian dollar is buying 72.88 US cents.

Cryptocurrencies

Bitcoin has fallen 12.4 per cent to US$4,900, Ethereum has shed 15 per cent to US$149 and XRP has fallen about 3.1 per cent to US$0.49.

Jessica Amir

Finance News Network
Jessica joined FNN in January 2017 with a passion for equities and funds management. As Head of News, she has been a broadcast journalist for over seven years, specialising in finance. She has been a journalist with Sky News Business, ABC 1, ABC's The Business and ABC24. She’s also worked as a TV reporter for regional Channel 7 and 9. She also previously worked as a financial planner and real estate agent.