ASX NEWS LIVE | ASX Set for Early Gains but Uncertain Day as Middle East Conflict Escalates

Crude oil prices have begun to ease after a nearly 5% spike overnight after Iran launched a missile attack towards Israel.

Iran’s direct involvement as a key OPEC member increases the likelihood of disruptions to the oil supply.

Israel reported that Iran launched over 180 ballistic missiles at the country last night in retaliation for Israel’s military actions against Tehran’s Hezbollah allies in Lebanon.

In response, the Israeli military stated today that its air force would intensify strikes across the Middle East and vowed retaliation against Iran.

Meanwhile, API data showed that US crude oil inventories declined by 1.5 million barrels last week, falling short of market expectations of a 2.1 million-barrel draw, but marking a second consecutive weekly drop.

Since that initial spike, prices have eased slightly, with prices trading at:

Brent Crude is currently trading at US$74.38 per barret, up +1.32%.

WTI Crude is currently trading at US$70.83, up 1.41%.

Samsung Electronics has begun workforce reductions across its global operations, with initial layoffs reported in Southeast Asia, Australia, and New Zealand.

This move is part of a broader strategy to streamline the company’s international workforce, potentially affecting thousands of employees worldwide.

According to sources within the company, the job cuts could impact approximately 10% of Samsung’s workforce in these regions, though the exact figures have not been mentioned.

The tech giant is also planning similar reductions in other overseas markets, with some potentially seeing up to a 10% decrease in staff.

Samsung employs about 147,000 people outside of South Korea, representing more than half of its total global workforce.

The company has stated that it does not intend to conduct layoffs in its home market of South Korea.

A Samsung spokesperson addressed the situation, saying:

‘Some overseas subsidiaries are conducting routine workforce adjustments to improve operational efficiency.’

The ASX 200 is flat around midday, trading at 8,211.4 as losses in technology and healthcare are offset by strong gains in Energy stocks.

Eight out of eleven sectors saw declines, with technology leading the downturn in line with a sharp drop in the Nasdaq overnight.

Investors rushed to safe-haven assets such as gold and bonds following Iran’s launch of ballistic missiles at Israel.

Energy emerged as the standout sector on the ASX, climbing 2.7%, mirroring the rise in oil prices due to fears of potential supply disruptions in the Middle East.

Brent crude rose +1.3% since yesterday at US$74.55 per barrel, while WTI crude rallied 1.5% to US$70.88.

Both had briefly spiked more than 5% overnight in response to the missile attack.

Among energy stocks, Woodside saw a 3.76% increase, while Santos jumped 2.9% after securing an LNG supply contract with TotalEnergies Gas & Power Asia. Karoon Energy was near the top gains on the index with a 6.7% rise.

In other commodities, index-heavyweight BHP rose 1.55%, while Rio Tinto gained +0.42%, while Fortescue gained +0.80%.

Spot gold hovered near a record high of US$2,658 per ounce, benefiting precious metal miners such as Regis Resources and Genesis Minerals, which saw increases of 2.5% and 3.6%, respectively.

The major banks’ performance was subdued amid choppy trading. ANZ rose 0.13%, Commonwealth Bank was flat, and NAB and Westpac saw slight falls.

Hotel Property Investments [ASX:HPI] has sent a notice from its board of directors to reject the takeover offer from Charter Hall Retail REIT and Hostplus.

The offer was at $3.65 per share, which the HPI board described as ‘materially undervalued’ and ‘opportunistic’.

In their response today, the company sent a lengthy rebuttal to the offer, attempting to sell the idea that HPI is already delivering returns for investors and is ‘in a strong position and delivering growth returns’.

You can see the full response here. Or a shorter presentation summarising here.

Hotel Property Investments’ shares are up 0.27% in trading so far this morning, trading at $3.74 per share.

The ASX 200 opened down by -0.33% to 8,182.2 as healthcare and technology stocks drag down the major index despite gains from the Energy sector.

Energy stocks are likely today’s major gainers after a nearly 4% spike in crude oil prices overnight as Iran launched a missile attack on Israel.

The energy sector is up 2.05% at open, with Woodside Energy up by +2.5%, Santos gaining +2.7%, and Ampol up 1%.

Outdoor gear retailer KMD Brands [ASX:KMD] has announced the appointment of Brent Scrimshaw as its new chief executive to replace Michael Daly, who resigned after a three-year tenure.

The retail group that owns well-known lifestyle brands Kathmandu, Rip Curl and Oboz has seen a tough 18 months as retail spending in NZ and Australia remains subdued.

The board thanked Mr Daly for leading the business ‘very well through the difficult Covid lockdowns, and more recently, weaker consumer discretionary spending.’

Mr Daly will remain in the role for another six months as Scrimshaw runs down his notice period for his current role as Enero Group chief executive.

Mr Scrimshaw has been a director of KMD Brands since 2017 and previously worked at Nike.

KMD Brands has seen its share price fall 40% in the past 12 months, currently trading at 47 cents before opening today.

Good morning. Charlie here,

The Aussie market is set for an uncertain day. ASX 200 Futures point to a rise on the opening bell as the conflict in the Middle East again escalates.

Hours after Israel launched a ground invasion into Southern Lebanon, Iran launched a missile barrage of around 180 rockets towards Israel.

Reports from US and Israeli sources say that the majority of the attack was intercepted.

In response, Israeli PM Benjamin Netanyahu warned that:

‘Iran made a big mistake tonight — and it will pay for it.’

 

‘Whoever attacks us, we will attack them,’ he said.

Meanwhile, Iran’s revolutionary guard warned of ‘crushing attacks’ if Israel retaliates to the attack. Iran’s attempt to underline the attacks as a once-off is likely to fall on deaf ears as Israel intensifies its ground offensive against Iran’s proxy Hizbollah in Southern Lebanon.

The market response was a ‘risk off’ day, with safe-haven assets such as gold and bonds rising, while many growth stocks fell.

Oil prices also spiked nearly 4% overnight, with Brent Crude at US$74.51 per barrel.

Elsewhere in the market, Wall Street and Europe largely sold off overnight, with the S&P 500 down nearly 1% and the Nasdaq falling -1.5%.

Cryptocurrencies also fell sharply, with Bitcoin nearly dropping 5% overnight.

On the ASX today, we’ll be watching the reaction in markets to the announcement of a new CEO for outdoor retail brand KMD and Energy stocks amidst the crisis.