The ASX’s best trading session since mid-May helped the market spike early last week and ultimately close the week higher, with the interim trade deal struck between the US and China giving investors plenty of reasons to be cheerful. By the close of trade on Friday, the ASX 200 and All Ordinaries gained 1.1% and 1.2% respectively, led by a strong showing from the utilities sector, which rose 4.5%.
Which shares excelled?
Several of last week’s leading stocks surged despite releasing no price-sensitive news to the market. One of these was Saracen Mineral Holdings (ASX: SAR), which jumped 9.9%. New Zealand telecoms infrastructure provider Chorus Limited (ASX: CNU) and cloud technology provider Megaport Limited (ASX: MP1) also found themselves in the same position, climbing 9.5% and 9.8% respectively.
Meanwhile, it was a prosperous week for shareholders in APA Group (ASX: APA), with the energy infrastructure business announcing a new gas transportation agreement. The two-year deal with AGL will start January 1, 2020. APA shares lifted 8.1% on the news.
Northern Star Resources (ASX: NST) resumed trading after completing its mega acquisition of a 50% stake in the Kalgoorlie Super Pit mine. In total, the gold explorer raised $765 million as part of the $1.17 billion acquisition. The company’s shares soared 10.9%.
Elsewhere, Air New Zealand (ASX: AIZ) had a tremendous week, surging 7.8%. The strong performance came as the airline unveiled modest growth in its November passenger traffic, and in quick succession to news that it has secured capacity to maintain its international summer schedule.
Northern Star Resources has taken up a 50% stake in the Kalgoorlie Super Pit
Which shares dragged on the market?
Jumbo Interactive (ASX: JIN) was one of the worst-performing stocks last week as investors rushed to the exits following a soft trading update showing easing growth. Shares in the lottery company crashed 16.9%.
Smartgroup (ASX: SIQ) and Perenti Global (ASX: PRN) also felt the wrath of investors, plummeting 24.2% and 21.1% respectively. Smartgroup announced a $4 million hit to its profits amid insurance product changes, while Perenti took a $20-25 million haircut after a subsidiary’s equipment hire contract was terminated.
After a strong run in both of their stock prices, investors took profits off the table from Lynas Corporation (ASX: LYC), down 7%, and Virgin Money UK (ASX: VUK), down 5.3%.
Lynas was awarded lead agency status for its plans to build a rare earths plant in Kalgoorlie, however, this was overshadowed by news the company was unsuccessful obtaining Malaysian regulatory approval to increase processing limits for lanthanide concentrate.
Also on the list of stocks that dragged on the market was Whitehaven Coal (ASX: WHC), which shed 5.3% of its market cap even though it released no meaningful news.
Finally, Lend Lease (ASX: LLC) shares dropped 4.6% after the construction company advised investors it has found a buyer for its engineering business. While long-awaited news, shareholders were disappointed to find out that some of the company’s underperforming projects were excluded from the divestment.
It was bad luck for investors in lottery business Jumbo Interactive
Other trading developments
The banking sector continues to remain under pressure, with NAB (ASX: NAB) this time in the spotlight. ASIC has accused the bank of breaking the law over 10,000 times with regards to its product disclosure statements and profiting from advice never administered to customers. At the same time, ANZ (ASX: ANZ) announced it has overcharged customers, and class actions commenced against Westpac (ASX: WBC) for its own indiscretions.
Last week’s new IPO listings performed as follows:
||Gain / Loss
Qantas reached a new 52-week high last week. Will that momentum continue?
This week’s trading outlook
Ahead of a shorter trading week, futures are pointing to a lower open for the ASX this morning, despite a positive trading session in the US on Friday night.
The only economic news on the calendar this week is private sector credit data due later this morning at 11:30am AEDT. This reading is unlikely to have a major influence on the broader market, however, a surprise reading could offer some support to the major lenders including Commonwealth Bank (ASX: CBA).
The key watch-point for investors will be housing credit as analysts try to get a better reading on whether the rebound in the property market is merely a temporary blip or the start of an upturn in the cycle. Residential property developers and building material suppliers may be among those stocks the market keeps a close eye on.
Iron ore prices fell abruptly by 2.5% in Friday’s offshore session, which could put pressure on the major iron ore miners. Shares like Fortescue Metals (ASX: FMG) and Rio Tinto (ASX: RIO) are most prone to the decline, however, BHP (ASX: BHP) is also susceptible to movements in the commodity price and a fall in oil prices may also weigh on its shares.
Investors looking for dividend stocks this week have a bunch of ETFs to monitor. Many of these are from leading investment management company BlackRock, including but not limited to iShares Europe (ASX: IEU), iShares MSCI Emerging Markets (ASX: IEM), iShares S&P 500 (ASX: IVV) and iShares Asia 50 (ASX: IAA). Remember that if you are looking to invest in shares paying dividends, to be eligible to receive the dividend you must purchase the stock before the ex-dividend date.
Other shares that are likely to be on the radar of investors this week include Qantas Airways (ASX: QAN), Macquarie Group (ASX: MQG) and Domino’s Pizza (ASX: DMP), all of which are trading at their 52-week highs. At the other end of the spectrum, contrarian investors may turn their attention to Costa Group Holdings (ASX: CGC), which is trading near its 52-week low and down 63.5% over the last year.
Last but not least, Icetana Limited (ASX: ICE) is making its ASX debut this afternoon at 1pm AEDT. The video analytics software business has raised $5 million from investors by issuing 25 million shares at $0.20 each, with the company’s top 20 shareholders accounting for 81.9% of total issued capital.
We’ll be back next week with another Weekly ASX Trading Wrap Up – until then, have a great week!
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