ASX News LIVE | ASX to Rise; ANZ Gets Greenlight for Suncorp Takeover

The ASX 200 concluded the financial year to June 30 with a 7.96% increase, falling slightly short of the previous year’s 9.7% return.

In the final week, which was dominated by rising expectations of an interest rate hike from the RBA the market closed flat after gaining just +0.10% in trading today.

Technology emerged as the standout sector for financial year 2024, posting a 28% gain.

In contrast, the energy sector struggled, declining by -7.4%, largely due to Woodside’s weaker performance, with the stock down by -17.68% in the past 12 months.

The mining sector faced significant pressure on the final day, finishing down -1%. Lithium miners continued their challenging run in 2024, with Pilbara Minerals plunging -5.8% and Mineral Resources dropping -3.6%.

In company news, Treasurer Jim Chalmers approved ANZ’s proposal to acquire Suncorp Bank, albeit with some conditions like not closing regional branches for three years.

In property news, Mirvac Group successfully sold a $1.3 billion stake in a new Sydney office tower to Japanese developer Mitsui. This transaction pushed Mirvac’s shares up +3.3% to $1.87.

Insurer IAG saw a strong afternoon boost, with its shares surging +7.2% to $7.14. This followed the announcement of a major reinsurance deal and confirmation of the company’s operating earnings guidance for the financial year 2024.

 

Guzman y Gomez [ASX:GYG], the popular Mexican restaurant chain, recently made its debut on the ASX in a blockbuster IPO.

The company, which operates 185 stores across Australia, raised $335 million in its public offering, with shares initially priced at $22 each.

GYG was listed on the ASX on June 20, and after seeing an initial enthusiastic response with shares surged 36% from the offer price, reaching $30. However, recent trading activity has shown some volatility.

In today’s session, GYG shares have seen a 6.5% decline, with shares currently trading at $27.70, making it the current underperformer of the ASX 200.

Insurance Australia Group [ASX:IAG] shares jumped 7% to a four-year high after securing reinsurance protection from Berkshire Hathaway and Canada Life Reinsurance.

The agreements, worth up to $2.8 billion over five years, aim to ‘stabilise earnings and reduce capital requirements‘ the announced today.

Interestingly, the notes described the deal as a ‘unique long-term deal to provide additional protection against increasing severity and frequency of perils events’.

IAG expects this to limit annual natural peril costs to $1.28 billion in FY25.

The company also maintained its full-year profit outlook.

IAG also anticipates its fiscal 2024 gross written premium to match February’s ‘low-double digit‘ forecast.

For more details on the deal and their strategy moving forward, click here to see the full note and presentation.

Nine Entertainment [ASX:NEC], the parent company of The Age, Sydney Morning Herald, The Australian Financial Review, and Nine News, has revealed plans to reduce its workforce by up to 200 employees across its network, citing challenging economic conditions.

According to the Sydney Morning Herald, Nine’s CEO Mike Sneesby distributed an internal email to staff this morning, blaming the job cuts on a deteriorating advertising market and the expiration of a partnership with Meta.

“From our nationwide team of almost 5000 people, around 200 jobs are expected to be affected across Nine including some vacant and casual roles not being filled,” Sneesby said in the email.

The restructuring is expected to impact various divisions, with approximately 90 positions being eliminated from the publishing arm and an additional 38 from the news and current affairs broadcasting sector.

Property group Mirvac [ASX:MGR] has announced the sale of a two-thirds stake in its planned $2 billion Sydney office tower to Mitsui Fudosan, one of Japan’s largest listed property companies.

The stake sold to Mitsu is valued at approximately $1.3 billion, and will bring Mitsu in to share the leasing risk for the tower.

Post-deal, Mirvac will maintain responsibility for development, construction, leasing, and investments.

The deal has brought in a significant partnership in the development of the 55-storey building at 55 Pitt Street, overlooking Sydney Harbour.

Mirvac also reaffirmed its full-year earnings guidance, with operating earnings per stapled security of 14-14.3 cents.

Share’s in Mirvac are up by +5.11% in trading today at $1.9 per share.

The ASX 200 is up by +0.5% at midday, trading at 7,799.2 as almost all sectors bounced off the lows set by the last two days of selling.

Only Mining (-0.37%) is failing it make gains today, while Utilities is sector leader at lunch, up by +1.21%.

Of the mining majors, BHP is down -0.60%, while Rio Tinto and Fortescue are down -1.1%.

Stand out performer from this morning’s trading is once again Encounter Resources, up by +15.75% as the exploration junior wow’s investors with its vertical shift higher.

On the other end of the market, Immutep continues to see selling pressure, down by -12.7% after its latest clinical trial results failed to wow shareholders.

The company has now lost -25.3% in the past week, wiping out all of the gains it has seen in the past 12 months.

The major news today is the approval of the ANZ-Suncorp takeover deal by Treasurer Jim Chalmers. For further details on the deal, read in post below.

Treasurer Jim Chalmers has given the green light to ANZ’s proposed acquisition of Suncorp Bank, subject to enforceable conditions.

The merger, set to be completed by July 31, has been approved based on the assessment that it ‘won’t significantly impact home loan lending competition‘, given Suncorp Bank’s current challenges in competing independently.

I was talking to an ACCC insider about the issue this week who noted that the ‘signficantly‘ portion of the impact on competition was a high bar for the ACCC to reach and some concerns do remain about lessened competition in the sector.

Regardless, the deal has been approved under some conditions, such as the prohibition of closing regional branches for three years.

In his speech this morning, Mr Chalmers said the deal would also ‘require ANZ to make every effort to join Bank@Post, ensure no net employment losses across Australia for three years due to the transaction, and insist on proper engagement with employees and the Finance Sector Union‘.

Key points of the deal include:

Suncorp will maintain its Queensland-based insurance operations as a separate entity.

The majority of proceeds from the bank sale will be returned to Suncorp shareholders by Q1 2025, pending other regulatory approvals.

The deal, initially proposed in July 2022, values Suncorp Bank at $4.9 billion, representing 1.3 times its net tangible assets.

After-tax and transaction costs, Suncorp shareholders are expected to receive net proceeds of $4.1 billion, or $3.21 per share.

As of the latest trading, Suncorp shares were priced at $16.80. While this morning ANZ shares were up by +0.2% to $28.34

Online beauty retailer Adore Beauty [ASX:ABY] has announced a $25 million cash acquisition of iKOU Holdings, a beauty brand with a growing store presence.

iKOU operates three retail stores in the Blue Mountains and Byron Bay. The brand also has established wholesale distribution channels, supplying products to retail stockists and luxury spas.

This acquisition comes at a time when Adore Beauty’s stock performance has been slumping, with it down by 36.8% in the year so far.

Shares in Adore are down by -5.85% in trading this morning at 88.5 cents per share.

As the Biden vs Trump first presidential debate begins soon, we look at some political risks markets may face in the near term.

The US debate will begin in 30 minutes and can be found live streaming here.

It will be the first time a current and former president will debate on live television and is expected to be a bit of a non-event.

While the debate itself is unlikely to bring up fireworks that could shake markets, economists and traders will be listening out for any mentions of tariffs or sanctions.

The first round of the French presidential election, which takes place this Sunday, will be a larger concern for markets in the next week.

The Bank of England has issued a warning about potential market volatility and financial instability in Europe following those elections.

The British Central Bank’s caution comes as recent opinion polls show the populist National Rally party, led by the far-right Marine Le Pen and rising political star Jordan Bardella, on the verge of securing a parliamentary majority.

The latest Harris poll indicates that National Rally could win up to 270 seats in the 577-seat parliament. With potential support from a breakaway faction of the conservative Republican party, this could pave the way for Bardella to become Prime Minister.

Emboldened by favourable polling, Le Pen has taken a confrontational stance. In a recent interview with Le Telegramme newspaper, she questioned the constitutional role of President Emmanuel Macron, who will remain in office until the end of his second and final five-year term in early 2027.

The ASX 200 opened up 0.63% to 7,808.8 as the market bounced from a two-day selloff amidst inflation concerns.

All sectors except mining are up this morning, with Real Estate seeing the biggest inflows on open.

Banking stocks are also lifting markets this morning as Treasurer Jim Chalmers approved the ANZ proposal to buy Suncorp Bank.

While we have seen the price of oil and precious metals climb overnight there remain concerns about a high USD pushing down commodity markets.

On open we also saw a sharp selldown of Bannerman Energy -7.26% as it announces a $85 million capital raise.

While on the positive end, Amotiv has seen the biggest opening inflows, up +4.66$.

Good morning. Charlie here, with a new addition to our morning update for easy viewing of today’s major markets.

The ASX 200 is set to rise this morning, with futures currently flat but steadily rising through the morning.

After two days of heavy selling due to concerns about rising inflation in Australia and tax loss selling, the market is looking for a recovery today.

While many have weighed in on when the next cuts will be for the RBA, if the past year is any indication, this timeline can shift rapidly with new data.

For the next signposts on the RBA’s next move in August, traders will be looking towards the June employment report (18 July) and the Q2 CPI report (31 July).

On the ASX, Treasurer Jim Chalmers has approved the ANZ-Suncorp under ‘strict conditions’. The takeover deal is worth $4.9 billion, around 1.3x the banks net assets.

On Wall Street, a fairly choppy session overnight, with markets closing slightly higher but lacking any real catalyst for movement.

For US investors, many will be looking towards Friday’s PCE data which includes personal income, spending, and other price-related data. Expectations are for a modest rise in PCE of 0.1–0.3%.