Market shows signs of recovery after fresh 8-year lows: Aus shares close 5.6% lower

Market Reports

by Katrina Bullock

An aggressive sell-off on the Australian market this morning forced the market to fresh 8-year lows today as investors feared the impact of extensive business shutdowns. The market showed signs of recovery over the afternoon but still closed 5.6 per cent lower. The Healthcare sector helped to stem the losses, managing to rise 2.6 per cent, against the tide of negative sentiment. All of the other sectors retreated. Oil is 33 cents higher after dropping to an almost 17 year low this morning.  

The S&P/ASX200 index

At the closing bell the S&P/ASX 200 index closed 271 points lower to finish at 4,546. 

Futures market

Dow futures are suggesting a fall of 697 points.
S&P 500 futures are eyeing a dip of 109 points.
The Nasdaq futures are eyeing a loss of 288 points.
And the ASX200 futures are eyeing a fall of 248 points or 5.2 per cent tomorrow morning. 

Broker moves

Credit Suisse has more than halved its 12-month price target for Air New Zealand (ASX:AIZ) from NZ$2.00 to NZ$0.95. This comes as Air New Zealand enters into a NZ$900 million debt funding agreement with the NZ government. This is intended to provide liquidity to navigate the period of border restrictions. As a condition of the agreement, Air New Zealand will be cancelling its FY20 interim dividend and any other future dividends while the debt facility is in place. Shares in Air New Zealand (ASX:AIZ) closed 16 per cent lower at 84 cents.

Company news 

Consolidated Tin Mines (ASX:CSD) will not be proceeding with the acquisition of Auctus Chillagoe Holdings and the Chillagoe Project. The acquisition was subject to the company obtaining shareholder approval. The company has had issues dispatching a notice of meeting to shareholders to get that approval, as the ASX refused to approve the notice until the 2019 audited accounts of Auctus were included in the Notice. Those accounts have not been finalised or provided to Consolidated Tine Mines which now says that shareholder approval is incapable of being obtained within the necessary timeframe. The company says the acquisition makes strategic sense and that it remains open to considering the acquisition if terms can be agreed with Auctus that are appropriate and reflect current market conditions. Consolidated Tin Mines is currently suspended from trading due to the failure to lodge its half year financial statements. Shares in Consolidated Tin Mines (ASX:CSD) last traded at 13 cents. 

AP Eagers (ASX:APE) says given the ongoing uncertainty of the duration and impact of the COVID-19 coronavirus pandemic, the directors have decided to reduce the amount of the fully franked final dividend which the company originally announced in February 2020 from 22.5 cents per share to 11.25 cents per share.

Fortescue Metals Group (ASX:FMG) says the Western Australian state government has advised that there will be exemptions for the strict border controls due to come in tomorrow. The exemptions will apply to mining industry workforces.

Flight Centre (ASX:FLT) announced that it is cancelling the $40.1 million interim dividend payment that was due to be paid to shareholders next month. To soften the blow, the company’s senior leadership team will also be taking a 50 per cent salary cut. 

Best and worst performers of the day

The best performing sector, and the only one capping gains today was Healthcare adding 2.6 per cent while the worst performing sector was REITs, shedding 11.2 per cent. 

The best performing stock in the S&P/ASX 200 was CIMIC Group (ASX:CIM), rising 6.9 per cent to close at $21.00. Shares in Sonic Healthcare (ASX:SHL) and Clinuvel Pharmaceuticals (ASX:CUV) followed higher.

The worst performing stock in the S&P/ASX 200 was Credit Corp Group (ASX:CCP), dropping 36.4 per cent to close at $6.25. Shares in Southern Cross Media Group (ASX:SXL) and Parenti Global (ASX:PRN) followed lower. 

Asian markets

Mixed: Japan’s Nikkei has added 2.9 per cent, Hong Kong’s Hang Seng has lost 3.9 per cent and the Shanghai Composite is trading steady. 

Commodities and the dollar 

Gold is trading at US$1,494 an ounce. 
Iron ore price fell 3.7 per cent to US$87.98. 
Iron ore futures are pointing to a further fall of 3.8 per cent. 
Light crude is US$0.33 higher at US$30.49 a barrel.
One Australian dollar is buying 57.53 US cents.