Humm dips on Westpac NZ deal, AfterPay and Zip tumble 8%: ASX trading 0.4% higher at noon

Market Reports

by Lauren Evans

The Australian share market is in positive territory despite Wall St’s retreat on inflation fears. It is trading 0.4 per cent or 27.7 points higher at 7,360 at noon. The SPI futures are pointing to a rise of 20 points.

The local bourse rose slightly after consumer confidence rose in July as jointly released by Westpac (ASX:WBC) and the Melbourne Institute and defied news of Sydney's extended lockdown for another two weeks.

Buy now pay later stocks are tumbling on news of Apple’s move to break into the sector. The upcoming service, known internally as Apple Pay Later, will, according to Bloomberg, allow consumers to pay for any Apple Pay purchase in instalments. Afterpay (ASX:APT) and Zip Co (ASX:Z1P) are down over 8 per cent.

ANZ Group (ASX:ANZ) and Westpac (ASX:WBC) are down 0.4 per cent and 0.2 per cent respectively out of the major four banks.

Utilities has been the best-performing sector, up 1.5 per cent, while Information Technology is down 2.1 per cent.

Seven Group's (ASX:SVW) interest in Boral (ASX:BLD) has increased to 48.41 per cent. Seven Group is trading 3.2 per cent higher at $22.78. Boral is trading 0.5 per cent at $7.35.

Across the Tasman, New Zealand's central bank said it will reduce stimulus for the economy as inflation pressures rise and growth rebounds from the pandemic. The Reserve Bank of New Zealand said it will halt its purchases of New Zealand government bonds which had helped to keep wholesale interest rates low by July 23. Their cash rate was left unchanged at a record low of 0.25 per cent.

Local economic news

The Westpac-Melbourne Institute Index of consumer sentiment rose by 1.5 per cent to 108.8 in July from 107.2 in June. Chief economist Bill Evans said "confidence has held up overall despite a sharp fall in NSW
as other states – notably Victoria and Western Australia – recorded strong bounce-backs from COVID-related disruptions in June"

The Australian Bureau of Statistics released overseas travel numbers for June. A total of 103,500 estimated arrivals, a decrease of 12,200 compared with May. June 2021 arrivals decreased 93.4 per cent when compared to pre-Covid-19 levels in June 2019.

Company news 

EROAD (ASX:ERD) has entered into a conditional agreement to acquire Coretex for up to NZ$188.3m.

NBN Co (nbn) has awarded Downer EDI (ASX:DOW) two contracts with an estimated value of over $220 million over two-and-a-half years. The contracts will commence in July 2021.

Following a review of operations, the board of Praemium (ASX:PPS) has recommended divestment of the company's international operations.

humm group (ASX:HUM), a developer of consumer finance products, has entered into a joint venture with Red Bird Ventures, a subsidiary of Westpac New Zealand, to bring buy now pay later product bundll to the New Zealand consumer market.

Austin Engineering (ASX:ANG), a supplier of customised mining equipment with operations in Australia, Asia and the Americas, has appointed David Singleton as CEO and Managing Director, effective from 14 July 2021. On 17 May 2021, the company had announced the retirement of previous CEO, Peter Forsyth.

AngloGold Ashanti (ASX:AGG), a South African-based gold miner with projects across nine countries, has submitted an acquisition proposal to the board of Corvus Gold.

Liontown Resources (ASX:LTR) has announced a $52 million capital raise for development of its key Kathleen Valley Lithium-Tantalum Project.

Best and worst performers

The best-performing sector is Utilities, up 1.5 per cent. The worst-performing sector is Information Technology, down 2.1 per cent.

The best-performing stock in the S&P/ASX 200 is Evolution Mining (ASX:EVN), trading 3.8 per cent higher at $4.80. It is followed by shares in Seven Group Holdings (ASX:SVW) and Ramelius Resources (ASX:RMS).

The worst-performing stock in the S&P/ASX 200 is Zip Co (ASX:Z1P), trading 8.9 per cent lower at $7.52. It is followed by shares in Afterpay (ASX:APT) and Lynas Rare Earths (ASX:LYC).

Commodities and the dollar

Gold is trading at US$1809.43 an ounce.
Iron ore is 0.3 per cent higher at US$218.48 a ton.
Iron ore futures are pointing to a fall of 0.4 per cent.
One Australian dollar is buying 74.58 US cents. 

Are you a 708 sophisticated investor?

A sophisticated investor is defined under Section 708 of the Corporations Act (net assets of $2.5 million or annual incomes in excess of $250,000).

They are eligible to receive information regarding wholesale investment opportunities that are not available to regular or retail investors.

Please subscribe if you would like to be alerted to these types of opportunities.