ASX closes lower; TPG falls 32%, tech sector slumps
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The news: The Australian sharemarket finished lower as TPG Telecom fell 32.1% and the tech sector led broad losses across the exchange.
The benchmark ASX 200 fell 1.36% to end at 8,634.5 with 10 out of the 11 sectors finishing in the red.
The tech sector (-4.4%) led losses as WiseTech Global (-4.6%), Xero (-3.9%), Technology One (-1.1%), NextDC (-4.9%), Life360 (-6.7%), Codan (-6.7%), Megaport (-9.6%), Catapult Sport (-7.8%) and Siteminder (-4.4%) finished lower.
Biggest movers:
- TPG Telecom (-32.1%) – Shares started trading ex-dividend ahead of a massive $1.61 per share cash distribution. This is part of a $3 billion capital reduction plan following the sale of its infrastructure assets and enterprise, government and wholesale fixed business to Vocus. Morningstar lowered its fair value estimate from $6.40 to $4.80.
Other news:
- Virgin Australia (-0.6%) – Reiterated its first-half guidance, but said it expects capacity growth to slow in the second-half of the financial year.
- Westpac (-1.6%) – Back-paid nearly 47,000 staff more than $50 million and signed an enforceable undertaking with the Fair Work Ombudsman, following 11 years of underpayments. A Westpac spokesperson said “we’re genuinely sorry this happened”.
- QBE Insurance Group (-1.1%) – Chair Mike Wilkins will retire from the board next year, with non-executive director Yasmin Allen picked as his replacement.
- Mayne Pharma – The Takeovers Panel has issued interim orders to prevent Cosette from escaping its deal to acquire Mayne Pharma by exceeding the end date of the scheme of implementation without panel approval. Treasurer Jim Chalmers has downplayed concerns around potential wider consequences if he blocks the deal. Was in a trading halt on Friday
What’s ahead:
- BusinessNZ will release performance of services index data for October on Monday at 8:30am AEDT.
- Statistics New Zealand will release food price index data for October on Monday at 8:45am AEDT.
