Mesoblast (ASX:MSB) boosts tech sector: Aus shares almost 2% higher over week

Market Reports

by Katrina Bullock

The market finished strong today closing 0.6 per cent higher, with most of the sectors capping gains. Information technology rose 4.2 per cent, thanks to an outstanding performance from biotech Mesoblast (ASX:MSB) which skyrocketed around 39 per cent higher on hopes that the FDA will approve its flagship product.

The S&P/ASX200 index

At the closing bell the S&P/ASX 200 index closed 35 points higher to finish at 6,126.

Over the week, the market has gained nearly 2 per cent.

Futures market

Dow futures are suggesting a rise of 55 points.
S&P 500 futures are eyeing a gain of 11 points.
The Nasdaq futures are eyeing a lift of 56 points.
And the ASX200 futures are eyeing a 33 point rise on Monday morning.

Economic news

The Australian Bureau of Statistics has released data on overseas arrivals and departures for the 2019 to 2020 financial year. It recorded 6.7 million overseas visitor arrivals for the year, down 27.9 per cent on the previous year. Most of Australia’s visitors came from New Zealand, followed by China then the USA.

RBA Governor, Philip Lowe testified to the House of Representative’s Standing Committee on Economics this morning. He said the RBA is not expecting a lift in economic growth until the December quarter, that the RBA may consider an extension to the Term Funding Facility and he controversially argued that the responsible lending rules which came into play after the Royal Commission had gone too far and were hindering credit growth.

Broker moves

Morgan Stanley rates Breville Group (ASX:BRG) as Overweight, with a 12 month price target of $29.00. Breville’s 2020 financial year results met the broker’s expectations. Global expansion appears to be on track, with new launches expected in Italy, Portugal and Mexico. The broker expects strong demand for small kitchen appliances in the short term to continue. Shares in Breville Group (ASX:BRG) closed 0.7 per cent higher at $25.18.

Company news

Shares in regenerative medicine company, Mesoblast (ASX:MSB) soared almost 40 per cent higher today after an advisory committee of the US Food and Drug Administration voted 9 to 1 that the available data supported the efficacy of remestemcel-L in pediatric patients. The Committee is an independent panel of experts that provide non-binding recommendations to the FDA. Mesoblast Chief Medical Officer Dr Fred Grossman says “Steroid-refractory acute graft versus host disease is an area of extreme need, especially in vulnerable children under 12 years old where there is no approved therapy.” Shares in Mesoblast (ASX:MSB) closed 39.1 per cent higher at $4.70.

Mobile measurement solution company, ikeGPS Group (ASX:IKE) has confirmed the successful completion of the retail component of its fully underwritten 1 for 7 accelerated non-renounceable entitlement offer.

Baby Bunting Group (ASX:BBN) released its full year 2020 results today. Statutory NPAT fell to $10 million, down 14 per cent compared to the prior corresponding period.

Iluka Resources (ASX:ILU) today announced its 2020 half year results for the period ended 30 June 2020. The company achieved net profit after tax of $113 million, down 17 per cent from the previous corresponding period.

National Australia Bank (ASX:NAB) has released a trading update for the third quarter. The bank raised concerns about early signs of "modest" asset quality deterioration.

Best and worst performers of the day

The best performing sector was Info Tech adding 4.2 per cent while the worst performing sector was Utilities, shedding 0.3 per cent.

The best performing stock in the S&P/ASX 200 was Mesoblast (ASX:MSB), rising 39.1 per cent to close at $4.70. Shares in Computershare (ASX:CPU) and Evolution Mining (ASX:EVN) followed higher.

The worst performing stock in the S&P/ASX 200 was Whitehaven Coal (ASX:WHC), dropping 3.7 per cent to close at $1.32. Shares in TPG Telecom (ASX:TPG) and Shopping Centres Australia (ASX:SCP) followed lower.

Wall Street

Wrapped up our four trading days this week higher: The Dow Jones added 1.7 per cent, the S&P 500 added 0.7 per cent and the tech heavy Nasdaq gained 0.3 per cent.

Asian markets

Higher: Japan’s Nikkei has added 0.2 per cent, Hong Kong’s Hang Seng has added 0.2 per cent and the Shanghai Composite has gained 0.3 per cent.

Commodities and the dollar

Gold is trading at US$1,954 an ounce.
Iron ore price fell 0.1 per cent to US$121.38.
Iron ore futures are pointing to a rise of 1.6 per cent.
Light crude has gained US$0.17 to US$42.41 a barrel.
One Australian dollar is buying 71.63 US cents.