ASX slips to three-week low as Atlas Arteria soars on $7b IFM bid
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The news: The Australian sharemarket finished lower as investors weighed stalled US-Iran peace talks and rising oil prices against a $7 billion takeover bid for Atlas Arteria.
The benchmark ASX 200 fell 20.1 points or 0.23% to 8,766.40, dropping below its 125-day moving average. The index has shed 2.09% over the past five sessions but remains virtually unchanged year to date. Trading volumes were subdued with public holidays in NSW, Western Australia and the ACT.
Atlas Arteria (+13.39%) surged to $4.91 after IFM Investors lobbed an unsolicited $4.75 cash per security off-market takeover offer through its subsidiary Diamond Infraco 1, which already owns 35% of the toll road operator and would lift the bid to $5.10 — a 19% premium worth $7.4 billion — if acceptances reach 45%.
NextDC (-2.21%) opened the $500 million retail leg of its $1.5 billion entitlement offer at $12.70 a share, the same terms as the institutional component that raised $1 billion last week.
Megaport (+5.06%) gained after its subsidiary secured a $35 million three-year contract.
Origin Energy (-5.40%) was among the worst performers in the benchmark after reporting Australia Pacific LNG revenue fell $247 million to $1.86 billion in the March quarter and production slipped to 164.5 petajoules. Origin also cut earnings guidance for UK-based Octopus Energy to between a $70 million loss and a $30 million profit, citing higher costs, regulatory changes and adverse weather. Resolute Mining (-8.54%) led the index lower.
Energy stocks tracked Brent crude higher as US-Iran peace talks stalled over the weekend, with President Donald Trump scrapping his envoys’ visit to Islamabad. Markets pared losses through the session after Axios reported Iran had offered the US a deal via Pakistan to reopen the Strait of Hormuz and end the war, with nuclear negotiations parked for future discussions.
The context: It is a heavy week for central bank decisions, with the US Federal Reserve, European Central Bank, Bank of England, Bank of Japan and Bank of Canada all due to hand down calls.
What’s ahead:
- The Bank of Japan will hand down its rate decision on Tuesday following its two-day meeting.
- The Australian Bureau of Statistics will release March quarter CPI data on Wednesday at 11:30am AEST.
- The Bank of Canada will deliver its rate decision on Wednesday night AEST.
- The US Federal Reserve will hand down its rate decision early Thursday morning AEST.
- The European Central Bank will deliver its rate decision on Thursday evening AEST.
- The Bank of England will hand down its rate decision on Thursday night AEST.
- The Reserve Bank of Australia will deliver its next rate decision on Tuesday 5 May, with markets pricing in an almost 75% chance of a rate rise.
