Speedcast shares down after Chairman's letter: ASX closes 0.5% higher

Market Reports

by Rachael Jones

After a shaky start is has been a positive day of trade for the Australian share market. After opening in the red the local bourse managed to maintain momentum to gain 0.5 per cent. Satellite telecommunications service provider Speedcast (ASX:SDA) shares are down after Chairman John Mackay noted that the board is disappointed with their first half performance. He said their 2018 acquisition Globecomm was a good strategic opportunity but has proven to be challenging, and time-consuming. Estia Health (ASX:EHE) saw their shares fall this morning after announcing they have been served with a class action, more on this later. As for the sectors, Consumer Staples was leading the way and REITS trailing behind.

The S&P/ASX200 index

At the closing bell the S&P/ASX 200 index closed 32 points higher to finish at 6673.

Futures market

Dow futures are suggesting a rise of 10 points.
S&P 500 futures are eyeing a rise of 1 points.
The Nasdaq futures are eyeing a lift of 2 points.
And the ASX200 futures are eyeing a 21 point rise tomorrow.

Economic news

The six month annualised growth rate in the Westpac– Melbourne Institute Leading Index, rose from –0.47 per cent in May to –0.02 per cent in June.

Broker moves

Citi has downgraded mining company Galaxy Resources (ASX:GXY) to a Neutral from a Buy, with a 12-month price target of $1.60. Citi rate Galaxy as high risk due to underlying lithium price volatility and uncertainty around project start and ramp-up. Shares in Galaxy Resources (ASX:GXY) trading 6.6 per cent lower at $1.28..

Company news

Regis Resources (ASX:RRL) has submitted a development application for McPhillays Gold Project. The Project is expected to require an average of 350 construction jobs during the construction phase and over the ten-year operational life there will be an average of 260 direct jobs. Shares in Regis Resources (ASX:RRL) closed 1.9 per cent higher to $5.90.

Estia Health (ASX:EHE) has been served with a class action proceeding filed by the law firm Phi Finney McDonald in the Federal Court of Australia. The proceeding alleges breaches of market disclosure obligations in 2015 and 2016. Estia will vigorously defend the proceeding.

BHP (ASX:BHP) released an operational review of the year showing 2019 financial year finished with an 11 per cent increase in quarterly production. Total iron ore production was broadly unchanged at 238 million tonnes.

InvoCare (ASX:IVC) is buying up again - they have entered into a conditional purchase agreement to acquire Australian Heritage Funerals located in Toowoomba in Queensland. This looks likely to be complete by the end of the month.

Best and worst performers 

The best performing sector was Consumer Staples adding 1.1 per cent while the worst performing sector was REITS shedding 0.3 per cent.

The best performing stock in the S&P/ASX 200 was Elders (ASX:ELD), rising 16.4 per cent to close at $7.05. Shares in Austal (ASX:ASB) and Western Areas (ASX:WSA) followed higher.

The worst performing stock in the S&P/ASX 200 was Speedcast International (ASX:SDA), dropping 6.7 per cent to close at $1.80. Shares in Galaxy Resources (ASX:GXY) and Estia Health (ASX:EHE) followed lower.

Asian markets

Japan’s Nikkei has lost 0.3 per cent, Hong Kong’s Hang Seng has lost 0.3 per cent also and the Shanghai Composite has lost 0.35 per cent.

Commodities and the dollar

Gold is trading at US$1,405 an ounce.
Iron ore price rose 0.6 per cent to US$122.15
Iron ore futures are pointing to a fall of 1.0 per cent.
Light crude is US$2.07 down at US$57.61 barrel.
One Australian dollar is buying 70.10 US cents.