ASX erases early gains: Aus shares close 0.3% lower

Market Reports

by Paul Sanger

At the closing bell, the S&P/ASX 200 was 0.28 per cent or 19.20 points lower at 6719.90.


The Dow Jones futures are pointing to a fall of 118 points.
The S&P 500 futures are pointing to a fall of 18.25 points.
The Nasdaq futures are pointing to a fall of 89 points.
The SPI futures are pointing to a fall of 13 points when the market next opens.

Best and worst performers

The best-performing sector was Real Estate Investment Trusts, up 0.92 per cent. The worst-performing sector was Utilities, down 1.39 per cent.

The best-performing stock in the S&P/ASX 200 was Lake Resources (ASX:LKE), closing 12.37 per cent higher at $1.04. It was followed by shares in Pilbara Minerals (ASX:PLS) and OZ Minerals (ASX:OZL).

The worst-performing stock in the S&P/ASX 200 was Sayona Mining (ASX:SYA), closing 8.62 per cent lower at $0.27. It was followed by shares in Magellan Financial Group (ASX:MFG) and Breville Group (ASX:BRG).

Asian markets

Shares in the Asia-Pacific have fallen ahead of major central bank meetings this week.

The Hang Seng index in Hong Kong is 1 per cent lower, with the Hang Seng Tech index down 2.04 per cent. South Korea’s Kospi has shed 1.24 per cent and the Kosdaq is 2.14 per cent lower.

In mainland China, the Shanghai Composite has dipped 0.16 per cent and the Shenzhen Component has declined 0.258 per cent. The People’s Bank of China cut its 14-day reverse repo rates.

BOJ no longer sees elevated inflation as temporary

Reuters sources suggested BOJ is no longer using the word "temporary" in reference to elevated inflation, and may go further by saying inflation will be higher than expected for the rest of this year, driven partly by yen depreciation. They still see slowing next year, but maybe not as much as previously thought. Still, sources noted that a weak economy will prevent a withdrawal of stimulus. While most economists do not see a change in monetary policy until the end of next year, BOJ internally debating pass-through of corporate sector's rising costs, in addition to heightening consumer inflation expectations. Story noted the word "temporary" had already been dropped from BOJ rhetoric in July according to transcripts and minutes of policy meetings, though drew little attention. Yen weakness said to become more of a focus for BOJ, though nothing specific was described.

Company news

Australian hi-tech company Micro-X (ASX:MX1) a leader in x-ray technology for health and security markets globally, has announced a strategic collaboration with Varex Imaging, the world’s largest independent manufacturer of x-ray technology components. The collaboration comprises an exclusive global licence for a non-refundable fee of $7.5M, which enables Varex to use Micro-X’s NEX technology in the field of multi-beam x-ray tubes, and an equity subscription to achieve a 9.9 per cent shareholding in Micro-X totalling $7.5M at a 10 per cent premium to the 15-day volume weighted average price. Shares closed 25.9 per cent higher at 17 cents.

Following the completion of the Ovato transaction, IVE Group (ASX:IGL) today announced a capital raise. The company intends to raise $20 million by an institutional placement and a share purchase plan. The purpose of the raise is to preserve the company’s ability to pursue growth initiatives and acquisitions, and to strengthen IVE’s institutional shareholder base. Shares under the placement and SPP will be issued at $2.25, and the placement will result in about 8 million new shares.
Origin Energy (ASX:ORG) has announced it will divest its 77.5 per cent interest in the exploration assets it currently holds in the Beetaloo Basin, having executed agreements with a consortium led by Tamboran Resources (ASX:TBN). The sale is part of Origin’s broader strategy to exit all exploration activities over time. Tamboran (ASX:TBN) is in a trading halt pending the completion of a capital raising, which is understood to involve overseas investors -- likely to be Tamboran’s existing strategic shareholders. The deal is indicated to involve a payment of $60M to Origin as well as ongoing 5.5 per cent royalty payments. Importantly, Origin has also executed a gas sales agreement with Tamboran for up to 36.5 Petajoules per annum over 10 years -- an important indicator of the potential commerciality of the Beetaloo Basin. Shares closed 0.86 per cent lower at $5.76

Commodities and the dollar

Gold is trading at US$1665.80 an ounce.
Iron ore is 2.6 per cent lower at US$98.45 a tonne.
Iron ore futures are pointing to a rise of 0.06 per cent.
Light crude is trading $0.32 lower at US$84.44 a barrel.
One Australian dollar is buying 66.89 US cents.

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