The Australian market dropped three days of gains, falling more than 1% before recovering to more modest losses today.
Energy stocks lost about 2% in value across the sector. Liquefied Natural Gas Limited was down more than 14% to $2.70 and Sundance Energy was weaker by more than 13% to $0.55.
The banks were also a drag on the market with the NAB leading the pack down by 1.25% to $32.40, followed by Westpac which was 1.17% weaker at $33.01.
Compared to last Friday’s close, the market is up just 0.4%, but it is 2.4% higher than the big fall on Monday.
First, the scoreboard:
- S&P ASX 200: 5,335.30 -33.49 (-0.62%)
- All Ordinaries: 5,313.60 -31.81 (-0.60%)
- AUD/USD: 0.8375 -0.0009 (-0.11%)
And the top stories on Friday:
1. Two private equity groups have made a joint bid for ASX-listed Bradken Limited, valuing the steel works and engineering company at more than $900 million. The $5.10 share bid by Pacific Equity Partners and Bain Capital Asia was a 46% premium on yesterday’s closing price. Its shares were up 36% to $4.53, still lower than the bid price.
2. Retail veteran Solomon Lew has had enough of foreign companies avoiding GST by delivering to Australians from overseas. He’s now going to find a way to avoid paying the 10% tax himself. Shares in his ASX-listed company Premier Investments were up 2% to $10.65.
3. Shares in Mt Gibson Iron crumbled after it decided to mothball its Koolan Island iron ore mine in Western Australia. Its shares were down 50% to $0.205.
4. Rate cuts. The rush to call an interest rate cut in 2015 continues with Westpac’s chief economist Bill Evans formally changing the bank’s outlook. Westpac expects a cut in February and then again in March, taking the official cash rate to 2%. A contraction in Australia’s construction industry also points to interest rate cuts.