ASX News LIVE | XJO Set for Heavy Losses as Wall St Enters Correction and Middle East Heats Up

The ASX 200 closed down -0.79% today at 6,772.9, with only the Tech (+0.43%) sector remaining in the green at the closing bell. The worst-performing sector today was the Energy sector, which fell -2.59% as oil prices continued to fall.

Brent Crude fell -1.33% to US$89.28, while WTI Crude fell by -1.48% to US$84.27. These dropped as fears of a wider conflict have yet to materialise as Israel began its offensive into the Gaza Strip.

Tensions are still high, however as the IDF also undertook airstrikes in Syria and Lebanon today in response to attacks from the regions.

In other news, Russian Defence Minister Sergei Shoigu said that Russia was ready for talks on a settlement to the war it undertook versus Ukraine.

ASX gold miners presented one of the few positive movements in trading today, as investors seeking safe havens sent the price of the commodity higher at the end of last week. Gold eased 0.19% on today after climbing above US$2000 on Friday for the first time since May.

In company news, IGO dropped 9% after its quarterly report highlighted that softer lithium prices and production woes will mean it will likely face another poor quarter in December after its underlying profits fell by 42% in this quarter.

Star Entertainment Group extended its losses today, falling 8.4% to 54.5 cents. The gambling company is now down over 64% since the beginning of 2023.

The ASX 200 closed down -0.79% today at 6,772.9, with only the Tech (+0.43%) sector remaining in the green at the closing bell. The worst-performing sector today was the Energy sector, which fell -2.59% as oil prices continued to fall.

Brent Crude fell -1.33% to US$89.28, while WTI Crude fell by -1.48% to US$84.27. These dropped as fears of a wider conflict have yet to materialise as Israel began its offensive into the Gaza Strip.

Tensions are still high, however as the IDF also undertook airstrikes in Syria and Lebanon today in response to attacks from the regions.

In other news, Russian Defence Minister Sergei Shoigu said that Russia was ready for talks on a settlement to the war it undertook versus Ukraine.

ASX gold miners presented one of the few positive movements in trading today, as investors seeking safe havens sent the price of the commodity higher at the end of last week. Gold eased 0.19% on today after climbing above US$2000 on Friday for the first time since May.

In company news, IGO dropped 9% after its quarterly report highlighted that softer lithium prices and production woes will mean it will likely face another poor quarter in December after its underlying profits fell by 42% in this quarter.

Star Entertainment Group extended its losses today, falling 8.4% to 54.5 cents. The gambling company is now down over 64% since the beginning of 2023.

We have exciting news coming to the Money Morning website and our services.

On Wednesday, we’ll be launching a brand-new website called Fat Tail Daily!

You’ve probably heard the Fat tail word bandied about a lot, but what does it actually mean?

Essentially, it’s the edge events that occur within things like financial markets at a higher probability than what many assume.

Source: wilsonsadvisory

Along with our other publications, we will combine into one great website with all the Fat Tail ideas and a single email (if you’re subscribed), covering an array of market sectors that you can select yourself to ensure you’re always up to date with the most exciting investment opportunities within the sectors that interest you most.

So if you log in this week and see things have changed, then have a look around at some of the new offerings and all the updated info on investments that will set you up for a profitable 2024.

We have exciting news coming to the Money Morning website and our services.

On Wednesday, we’ll be launching a brand-new website called Fat Tail Daily!

You’ve probably heard the Fat tail word bandied about a lot, but what does it actually mean?

Essentially, it’s the edge events that occur within things like financial markets at a higher probability than what many assume.

Source: wilsonsadvisory

Along with our other publications, we will combine into one great website with all the Fat Tail ideas and a single email (if you’re subscribed), covering an array of market sectors that you can select yourself to ensure you’re always up to date with the most exciting investment opportunities within the sectors that interest you most.

So if you log in this week and see things have changed, then have a look around at some of the new offerings and all the updated info on investments that will set you up for a profitable 2024.

Activist UK hedge fund Bell Rock Capital sold most of its shares of Whitehaven just days after successfully pushing for a protest vote against the company’s decision to buy two major coal mines off BHP.

The hedge fund has been pushing a media blitz against the company for this month after emerging out of the shadows to try and reverse the decision, describing the plan as:

“Under WHC’s current plan, the company could destroy the share price, cancel or reduce dividends, stop the share buy-back, and still pay a healthy bonus to management,” Bell Rock chief investment officer Michael O’Mara wrote in the letter to shareholders.

“That’s not fair to shareholders.”

Bell Rock had previously been polling shareholders and putting out full-page ads to try and get more onside to reject the decision.

Whitehaven’s acquisition of BHP’s two Queensland mines would be a major shift for the company, given its current market capitalization of around $6 billion. BHP has cited two reasons for the sale, which Macquarie Capital is handling: a desire to focus on commodities needed for the transition to cleaner energy and a tax hike in Queensland that has made the mines less economically viable.

Whitehaven’s share price has fallen nearly 4% as the company sold shares at an average strike price of $7.72.

Activist UK hedge fund Bell Rock Capital sold most of its shares of Whitehaven just days after successfully pushing for a protest vote against the company’s decision to buy two major coal mines off BHP.

The hedge fund has been pushing a media blitz against the company for this month after emerging out of the shadows to try and reverse the decision, describing the plan as:

“Under WHC’s current plan, the company could destroy the share price, cancel or reduce dividends, stop the share buy-back, and still pay a healthy bonus to management,” Bell Rock chief investment officer Michael O’Mara wrote in the letter to shareholders.

“That’s not fair to shareholders.”

Bell Rock had previously been polling shareholders and putting out full-page ads to try and get more onside to reject the decision.

Whitehaven’s acquisition of BHP’s two Queensland mines would be a major shift for the company, given its current market capitalization of around $6 billion. BHP has cited two reasons for the sale, which Macquarie Capital is handling: a desire to focus on commodities needed for the transition to cleaner energy and a tax hike in Queensland that has made the mines less economically viable.

Whitehaven’s share price has fallen nearly 4% as the company sold shares at an average strike price of $7.72.

In documents filed today, Qantas hit back at the ACCC’s allegations that it deceptively sold ‘ghost flights‘. These were tickets to already cancelled flights for between two weeks to 47 days after the flights had already been cancelled internally.

The ACCC had gone after the airline full guns blazing and said that if the allegations were found to be true, the airline could expect a record fine for its misbehaviour.

In today’s response, Qantas admitted it had ‘let customers down’ but denied any deceptive practices and claimed that the ACCC did not understand the situation, saying:

‘We acknowledge there were delays and we sincerely regret that this occurred, but crucially, it does not equate to Qantas obtaining a ‘fee for no service’ because customers were re-accommodated on other flights as close as possible to their original time or offered a full refund.’

‘In purely legal terms, the ACCC’s case ignores a fundamental reality and a key condition that applies when airlines sell a ticket.’

It’s been an uphill battle for the airline this year, which has seen the CEO and Chairman step down or promise to in the coming year.

In documents filed today, Qantas hit back at the ACCC’s allegations that it deceptively sold ‘ghost flights‘. These were tickets to already cancelled flights for between two weeks to 47 days after the flights had already been cancelled internally.

The ACCC had gone after the airline full guns blazing and said that if the allegations were found to be true, the airline could expect a record fine for its misbehaviour.

In today’s response, Qantas admitted it had ‘let customers down’ but denied any deceptive practices and claimed that the ACCC did not understand the situation, saying:

‘We acknowledge there were delays and we sincerely regret that this occurred, but crucially, it does not equate to Qantas obtaining a ‘fee for no service’ because customers were re-accommodated on other flights as close as possible to their original time or offered a full refund.’

‘In purely legal terms, the ACCC’s case ignores a fundamental reality and a key condition that applies when airlines sell a ticket.’

It’s been an uphill battle for the airline this year, which has seen the CEO and Chairman step down or promise to in the coming year.

Australian retail sales beat expectations in September, rising 0.9%, the Australian Bureau of Statistics (ABS) said today.

This was well above the economists’ forecast of 0.3% and followed slower-than-expected growth of 0.3% in August and 0.6% in July.

The ABS attributed the strong result to a warmer-than-usual start to spring, which boosted sales at department stores, household goods and clothing retailers. However, the ABS warned that ‘while the September rise was the largest since January, underlying growth in retail turnover remains historically low.’

Trend growth in retail turnover is up only 1.5% compared to September 2022, the smallest growth over 12 months in the history of the series.

The Reserve Bank of Australia will be weighing the retail sales data when it decides on whether to raise interest rates next week.

Source: ABS

The ASX 200 has recovered from its early morning drop as technology stocks gained today but is currently down -0.53% at 6,790.8, its lowest point this year.

At midday, only the Tech (+1.42%) and Materials (+0.21%) sectors are in the green, while the nine other sectors are down.

The biggest gainers on the ASX 200 are Gold Road Resources, up 3.44% and Xero, up 2.14%, while Contact Energy (-7.27%) and IGO (-6.85%) are midday biggest fallers as IGO reports falling spodumene prices and troubled nickel production.

Gold and iron ore are the two big factors keeping a wider correction at bay for now within the ASX as Rio Tinto holds up +1%, and Fortescue Metals and BHP are both up +0.40%.

Oil prices continue to slide as Israel cautiously begins its offensive into Gaza, calming some fears of a broader conflict involving Lebanon’s Hezbollah and other Iran proxies.

The ASX 200 has recovered from its early morning drop as technology stocks gained today but is currently down -0.53% at 6,790.8, its lowest point this year.

At midday, only the Tech (+1.42%) and Materials (+0.21%) sectors are in the green, while the nine other sectors are down.

The biggest gainers on the ASX 200 are Gold Road Resources, up 3.44% and Xero, up 2.14%, while Contact Energy (-7.27%) and IGO (-6.85%) are midday biggest fallers as IGO reports falling spodumene prices and troubled nickel production.

Gold and iron ore are the two big factors keeping a wider correction at bay for now within the ASX as Rio Tinto holds up +1%, and Fortescue Metals and BHP are both up +0.40%.

Oil prices continue to slide as Israel cautiously begins its offensive into Gaza, calming some fears of a broader conflict involving Lebanon’s Hezbollah and other Iran proxies.

Hotel operator and Dan Murphy’s owner Endeavour Group [ASX:EDV] reported its quarterly earnings today, with the group’s revenue totalling $3.1 billion in the September quarter, up 2.1% from the prior.

The operator said it has seen a 2.8% increase in sales in its hotel segment, reaching $553 million as food and bars sales at its venues were lifted by major sporting events. Within its BWS and Dan Murphy’s chains, the company saw 2.6% growth in sales compared to the prior quarter and highlighted that customers are continuing to favour budget brands, saying:

‘In Retail, customers are searching for value and discovery, which is reflected in shifting category trends, including higher demand for mainstream beer, rosé and pre-mixed drinks.’

Looking ahead, the company said it was on track to enjoy strong sales in hotels in the Christmas period, with bookings already at record levels with 40% capacity across its 266 hotels.

Hotel operator and Dan Murphy’s owner Endeavour Group [ASX:EDV] reported its quarterly earnings today, with the group’s revenue totalling $3.1 billion in the September quarter, up 2.1% from the prior.

The operator said it has seen a 2.8% increase in sales in its hotel segment, reaching $553 million as food and bars sales at its venues were lifted by major sporting events. Within its BWS and Dan Murphy’s chains, the company saw 2.6% growth in sales compared to the prior quarter and highlighted that customers are continuing to favour budget brands, saying:

‘In Retail, customers are searching for value and discovery, which is reflected in shifting category trends, including higher demand for mainstream beer, rosé and pre-mixed drinks.’

Looking ahead, the company said it was on track to enjoy strong sales in hotels in the Christmas period, with bookings already at record levels with 40% capacity across its 266 hotels.

Free trade deal negotiations between the EU and Australia have been abandoned today, with both parties saying the other side was unwilling to compromise.

The Australian Agriculture Minister, Murray Watt, said that the EU had ‘not budged significantly from the offer put forward three months ago‘.

The negotiations had been ongoing since 2018 and had failed to make significant ground. Mr Watt accused the EU officials of being a ‘very protectionist market when it comes to agriculture’.

A spokesperson from the EU said today that,

“The European Commission regrets the lack of progress made during talks in Osaka today.”

“Our negotiating teams made good progress in recent weeks, including in the days leading up to the Osaka meeting. There was optimism that a deal was within reach.”

“However, ministerial discussions in Osaka did not see the same progress. The Australian side re-tabled agricultural demands that did not reflect recent negotiations and the process between senior officials.”

One small bit of good news for Australian growers: they will retain their names for their goods. One of the European demands that Australia was also unwilling to move on was that Aussie growers ceased using names for products that Europeans associate with particular regions from the continent, such as feta, parmesan, and prosecco.

Free trade deal negotiations between the EU and Australia have been abandoned today, with both parties saying the other side was unwilling to compromise.

The Australian Agriculture Minister, Murray Watt, said that the EU had ‘not budged significantly from the offer put forward three months ago‘.

The negotiations had been ongoing since 2018 and had failed to make significant ground. Mr Watt accused the EU officials of being a ‘very protectionist market when it comes to agriculture’.

A spokesperson from the EU said today that,

“The European Commission regrets the lack of progress made during talks in Osaka today.”

“Our negotiating teams made good progress in recent weeks, including in the days leading up to the Osaka meeting. There was optimism that a deal was within reach.”

“However, ministerial discussions in Osaka did not see the same progress. The Australian side re-tabled agricultural demands that did not reflect recent negotiations and the process between senior officials.”

One small bit of good news for Australian growers: they will retain their names for their goods. One of the European demands that Australia was also unwilling to move on was that Aussie growers ceased using names for products that Europeans associate with particular regions from the continent, such as feta, parmesan, and prosecco.

IGO Ltd [ASX:IGO] released its quarterly report this morning, showing the lithium miner’s underlying profits were down -42% to $362m compared to the previous quarter’s $620m, after lower spodumene pricing and deferred shipments weighed on sales revenues.

Despite the falling profits, the company said it reached record production of 414kt for the quarter from its joint venture Greenbushes project, in which the company owns a 49% stake.

The company signalled that spodumene sales in the December quarter were also likely to be affected by the current pricing as well as continued deferred shipments as inventories stack up around the globe.

“Looking ahead, we note the recent volatility in the lithium market and the impact this is having on participants across the supply chain, a dynamic which is not unexpected for a market which is growing rapidly,” said interim CEO Matt Dusci.

IGO reported finishing the quarter with $444 million in cash, including $360 million of drawn debt.

IGO Ltd [ASX:IGO] released its quarterly report this morning, showing the lithium miner’s underlying profits were down -42% to $362m compared to the previous quarter’s $620m, after lower spodumene pricing and deferred shipments weighed on sales revenues.

Despite the falling profits, the company said it reached record production of 414kt for the quarter from its joint venture Greenbushes project, in which the company owns a 49% stake.

The company signalled that spodumene sales in the December quarter were also likely to be affected by the current pricing as well as continued deferred shipments as inventories stack up around the globe.

“Looking ahead, we note the recent volatility in the lithium market and the impact this is having on participants across the supply chain, a dynamic which is not unexpected for a market which is growing rapidly,” said interim CEO Matt Dusci.

IGO reported finishing the quarter with $444 million in cash, including $360 million of drawn debt.

Good morning all, Charlie here

The ASX 200 opened down -0.31% to 6,806.0, as Wall Street moved into correction territory as the S&P 500 finished last week down 0.5% and put the index down over 10% from its July peak. The S&P500 is now trading at its lowest point since May after its eighth decline in nine sessions.

As predicted last week, the Magnificent Seven’s reporting week has been a troubling time for Wall St, with Apple, Alphabet, Amazon, Microsoft, Meta, Nvidia, and Tesla all reporting and have collectively lost approximately $450+ billion in valuation.

Amazon and Microsoft stood above the rest with strong double beats, while Google’s parent company, Alphabet beat expectations everywhere but cloud computing, which was enough to send its shares tumbling -9.5%.

Wall Street: The Dow -1.12%, Nasdaq +0.38%, S&P 500 -0.48%, Russell 2000 -1.21%.

Overseas Markets: FTSE -0.86%, STOXX -0.87%, Nikkei +1.27%, SSE +0.99%

US 10-year bond yields sit at 4.83%, and Australian 10-year fell -4bps to 4.83%.

Gold prices fell -0.32% but has passed the important mark to hit US$2,000.26. Silver fell -0.13% to US$23.08. The upward trend was driven by traders covering short positions in the aftermath of the Hamas attack, while global bullion ETFs saw five consecutive months of outflows.

The Aussie dollar is up +0.10%, to US63.37 cents.

Bitcoin is up +1.59% to US$34,660.65, having gained almost 30% in the past month.

Oil prices are continuing their volatility, with Brent flat, while WTI Crude fell -1%.

Iron ore is up +0.08% to US$118.55, but Singapore iron ore futures are tracking up 2.39%

We have September retail numbers for Australia coming this morning, so stay tuned for that as well as developments in the Middle East that are driving concerns in global markets.

Good morning all, Charlie here

The ASX 200 opened down -0.31% to 6,806.0, as Wall Street moved into correction territory as the S&P 500 finished last week down 0.5% and put the index down over 10% from its July peak. The S&P500 is now trading at its lowest point since May after its eighth decline in nine sessions.

As predicted last week, the Magnificent Seven’s reporting week has been a troubling time for Wall St, with Apple, Alphabet, Amazon, Microsoft, Meta, Nvidia, and Tesla all reporting and have collectively lost approximately $450+ billion in valuation.

Amazon and Microsoft stood above the rest with strong double beats, while Google’s parent company, Alphabet beat expectations everywhere but cloud computing, which was enough to send its shares tumbling -9.5%.

Wall Street: The Dow -1.12%, Nasdaq +0.38%, S&P 500 -0.48%, Russell 2000 -1.21%.

Overseas Markets: FTSE -0.86%, STOXX -0.87%, Nikkei +1.27%, SSE +0.99%

US 10-year bond yields sit at 4.83%, and Australian 10-year fell -4bps to 4.83%.

Gold prices fell -0.32% but has passed the important mark to hit US$2,000.26. Silver fell -0.13% to US$23.08. The upward trend was driven by traders covering short positions in the aftermath of the Hamas attack, while global bullion ETFs saw five consecutive months of outflows.

The Aussie dollar is up +0.10%, to US63.37 cents.

Bitcoin is up +1.59% to US$34,660.65, having gained almost 30% in the past month.

Oil prices are continuing their volatility, with Brent flat, while WTI Crude fell -1%.

Iron ore is up +0.08% to US$118.55, but Singapore iron ore futures are tracking up 2.39%

We have September retail numbers for Australia coming this morning, so stay tuned for that as well as developments in the Middle East that are driving concerns in global markets.