BHP Stock – ASX 200 set to fall – A2M, CWN & BHP shares in focus
The S&P/ASX 200 (ASX: XJO) finally joined the global party, hitting an all-time high of 7,172 points on Monday.
ASX 200 chart
The list of constituents trading at similar records also continues to grow with both BHP Group Ltd (ASX: BHP) and Rio Tinto Limited (ASX: RIO), up 3.1% and 4.6%, respectively, hitting their own all-time highs yesterday as the iron ore price jumped 10% on Friday to US$212 per tonne.
The incredible rally comes on the back of huge US and European steel demand, forcing China to ramp up production.
A2 Milk drained
A2 Milk Company Ltd (ASX: A2M) fell 13.1% but did little to detract from the jubilance after the company reported little improvement on the pricing, sales and inventory levels of its stock being sold through ‘daigou’ channels into China.
Sales for the third quarter were $295 million with revenue estimates reduced to $1.2-$1.25 billion for the full year. Management expects the difficult conditions to extend into FY22.
Retail sales on the up
Australian retail sales rose 1.3% in March further solidifying the economic recovery, driven by a recovery in café and restaurant spending, online sales remain just 9.4% of the total.
Bidding war for Crown heats up
The bidding war for embattled casino operator Crown Resorts Ltd (ASX: CWN) continues to heat up, with competitor Star Entertainment Group Ltd (ASX: SGR) lobbing a $12 billion bid for the company, ahead of private equity offers.
Star Entertainment highlighted cost savings of over $100 million and plans to fund the deal through a merger in which shareholders would receive 2.68 SGR shares for every Crown share, who would own 59% of the combined company.
The cash value alternative is $12.50 per share, with the Crown share price adding 7.3% on the news and Star finishing 7.7% higher. This deal would obviously need to overcome competition and receive a number of other approvals.
Despite the activity, Crown also announced that ex-Lendlease CEO Steve McCann would be joining Crown as the new chief executive.
Pendal doubling down again
Asset manager Pendal Group Ltd (ASX: PDL) has announced another acquisition, buying Thompson Siegel & Walmsley for $413 million which will be funded by a $190 million capital raising at $6.80 per share.
TSM is a US-based value-oriented investment management company that operates primarily in long-only equity (US and International) with US$23.6 billion (A$30.5 billion) of funds under management.
Alongside a2 Milk, ammonium producer Incitec Pivot Ltd (ASX: IPL) was the other major detractor, falling 8.9% after announcing its struggling production plant in the US would need to be shutdown for a second time with major repairs needs.
Once again, this highlights the company-specific risks sitting in a buoyant sharemarket.
ASX 200 today
Looking ahead, the ASX 200 is expected to open lower on Tuesday following a negative lead from US markets overnight. The Nasdaq suffered a particularly steep fall, dropping 2.6%. For all the latest, check out Rask Media’s US stock market report.