ASX drops as big four fall
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The news: The Australian sharemarket ended lower as banks fell with Macquarie analysts downgrading the big four.
The numbers: The benchmark ASX 200 finished down 0.2% to 7,713.6, with five out of 11 sectors finishing in red.
The financial sector was the worst performing, down 1.88%, followed by consumer discretionary (-0.73%) and telecommunication services (-0.71%). The big four all fell as Macquarie downgraded the banks as its analysts argued the firms were trading at peak multiples without a clear fundamental reason.
Westpac fell the most, down 3.89%, followed by ANZ (-3.79%), NAB (-3.02%) and Commonwealth Bank (-1.34%).
Aussie Broadband had the largest drop at 18.25% within the communications sector after it lost its wholesale broadband contract with Origin Energy that signed Superloop on as its new provider. Superloop was the best performer in the sector gaining 23.81%.
The best performing sector was materials, after sell-offs due to falling iron ore prices, that gained 1.85%. This was followed by consumer staples (0.55%) and healthcare (0.43)%. Arafura Rare Earths was the materials sector’s best performer up 83.05% after announcing the Federal Government committed an investment of $840 million in the company.
Liontown Resources fell 2.51%, after being the top performer on Wednesday. Today, Jarden analysts downgraded the lithium producer to ‘underweight’ from ‘neutral’ following its debt facility announcement.
Appen took a large hit, down 17.62%, after Nasdaq-listed Innodata withdrew its $154 million takeover bid. Innodata said its withdrawal was because Appen had disclosed the bid despite it being confidential. Appen disclosed the offer after the ASX price queried the company after shares surged despite there being no announcement.
The Australian dollar is lower buying US66.16 cents.
The context: Later this evening will see the US publish its latest core producer price index and unemployment figures ahead of the next US Federal Reserve’s monetary policy decision on 21 March.
