Annual wage growth slow pre-coronavirus restrictions: The ASX is tracking 0.9% lower

Market Reports

by Rachael Jones

The Australian share market dropped at the open as investors evaluate the risk of opening up the economy. It is now tracking almost 0.9 per cent lower at noon. Pilbara Minerals (ASX:PLS) did well today as did shares in Mayne Pharma Group (ASX:MYX). All the sectors are in the red with the communication services leading the pack.

The S&P/ASX 200 index is 50 points down at 5,353. On the futures market the SPI is 56 points lower.

Local economic news

The seasonally adjusted Wage Price Index (WPI) rose 0.5 per cent in the March quarter 2020 and 2.1 per cent through the year, according to figures released today by the Australian Bureau of Statistics (ABS). Today's data relates to the period shortly before restrictions were put in place to contain the spread of the coronavirus capturing wage information for the mid-month (February) of the March quarter.

Broker moves

Credit Suisse rates Kathmandu (ASX:KMD) as an Upgrade to an Outperform from a Neutral reducing the target to NZ$1.40 from NZ$3.65. The broker acknowledges there is earnings uncertainty but believes the strength of the company's execution during the lockdown, the consumer appeal of its brands and robust balance sheet contribute to confidence going forward.Target price not assessed. Shares in Kathmandu (ASX:KMD) are 1.6 per cent lower at $0.94.

Company news

Biotech Mesoblast (ASX:MSB) has successfully completed a capital raising of $138 million via a placement of 43 million shares to existing and new institutional investors at a price of $3.20 per share. A significant portion of the net proceeds will be used to scale-up manufacturing of the Company’s lead product candidate remestemcel-L for the treatment of critically ill patients suffering with diseases particularly Covid-19 acute respiratory distress syndrome (ARDS). Shares in Mesoblast (ASX:MSB) are 4.7 per cent lower at $3.28.

Best and worst performers

The best-performing sector is communication services with the fewest losses at 0.1 per cent, while the worst performing sector is A-REIT losing 2.5 per cent.

The best performing stock in the S&P/ASX 200 is Pilbara Minerals (ASX:PLS) rising 8.3 per cent to $0.23, followed by shares in Mayne Pharma Group (ASX:MYX) and Pro Medicus (ASX:PME).

The worst performing stock in the S&P/ASX 200 is Ausnet Services (ASX:AST) dropping 6.1 per cent to $1.88, followed by shares in Fletcher Building (ASX:FBU) and Alumina (ASX:AWC).

Asian markets

Lower: Japan’s Nikkei is 1.1 per cent lower. Hong Kong’s Hang Seng has lost 0.7 per cent and China’s Shanghai Composite has lost 0.5 per cent.

Commodities and the dollar

Gold is trading at US$1,702 an ounce.
Iron ore price is 3.5 per cent higher at US$91.67
Iron ore futures are suggesting a rise of 0.7 per cent.
One Australian dollar is buying 64.61US cents.