The Match Out: ASX up a touch today, down around 1% for the week, Crown gets a bid (again)

James Gerrish

Market Matters

The market finished marginally higher today but was down around 1% on the week, thanks to weakness among the financials, courtesy of Commonwealth Bank’s (ASX: CBA) disappointing update. Over the course of the week, the Financial sector was off -3.6% while Materials fell by -1.62%, making it a tough ask for the broader market. IT +2% and Healthcare +1.71% did an admirable job.

  • The ASX 200 finished up +17points / 0.23% at 7396 today.
  • Healthcare up nearly 1% the standout while the broader industrials lagged, off -0.61%.
  • Crown Resorts (ASX: CWN) +16.57% in the sights of Blackstone for a third time – more on that below.
  • Broker upgrades push Altium (ASX: ALU) +5.16% to new record highs; it’s understandable now why management was so adamant to reject the Autodesk bid.
  • Interesting comments today from CBA’s CEO Matt Comyn on crypto, “We see risks in participating, but we see bigger risks in not participating.” That sums it up pretty well!
  • The Uranium sector is one we’re keen on and hold Paladin (ASX: PDN) in our Emerging Companies Portfolio, however worth highlighting that the stocks are pricing in substantially higher U308 prices – in the case of PDN, it’s pricing in Spot Uranium at US$93/lb, when its closer to half that.
  • Spot Gold was a touch higher in Asia, hovering around $US1862 at our close.
  • Asian markets were mixed, The Nikkei in Japan +0.44%, Hong Kong -1.5% & China +0.26%.
  • US Futures are all trading up around 0.4%.

ASX 200 chart

Crown (ASX: CWN) $11.54

CWN +16.57%: received another takeover bid today from its second-largest shareholder behind JP, namely Blackstone. This is now the third time Blackstone has approached CWN, the private equity firm now upping its offer to $12.50 cash, valuing the company at about $8.5 billion. It had bid $11.85 in March and $12.35 in May. This prices-in +25% premium to last close but remains conditional on a few things, including Blackstone doing due diligence on an exclusive basis and the global investment firm receiving final approval from its investment committee – and it also wants complete board support. We think a deal will get done here, but the market is rightly sceptical given the recent history of failed buyouts. This is obviously positive for the shares and also positive for the Hybrids (CWNHB) we hold in our income portfolio.

Crown Resorts

Sectors this week (Source: Bloomberg)

Stocks this week (Source: Bloomberg)

Broker moves

  • AACO Cut to Hold at Bell Potter; PT A$1.70

  • REP AU Rated New Positive at Evans & Partners Pty Ltd; PT A$1.10

  • Capitol Health Reinstated Buy at Ord Minnett

  • Evolution Cut to Neutral at JPMorgan; PT A$4.50

  • Altium Raised to Buy at Jefferies; PT A$48.83

Major movers today

Have a great weekend all

James, Harry and the Market Matters team.

Make informed investment decisions

At Market Matters, we write a straight-talking, concise, twice daily note about our experiences, the stocks we like, the stocks we don’t, the themes that you should be across and the risks as we see them. Click here for your free trial.

The Match Out will be available each day after the market close. Follow my profile to be notified when the latest report is live.

Livewire gives readers access to information and educational content provided by financial services professionals and companies ("Livewire Contributors"). Livewire does not operate under an Australian financial services licence and relies on the exemption available under section 911A(2)(eb) of the Corporations Act 2001 (Cth) in respect of any advice given. Any advice on this site is general in nature and does not take into consideration your objectives, financial situation or needs. Before making a decision please consider these and any relevant Product Disclosure Statement. Livewire has commercial relationships with some Livewire Contributors.

2 topics

3 stocks mentioned

James Gerrish
Portfolio Manager
Market Matters

James is Portfolio Manager & Primary Author at Market Matters, a daily investment report with over 2500 subscribers that offers real market insight. He is also Senior Portfolio Manager within Shaw and Partners heading up a team that manages...

I would like to

Only to be used for sending genuine email enquiries to the Contributor. Livewire Markets Pty Ltd reserves its right to take any legal or other appropriate action in relation to misuse of this service.

Personal Information Collection Statement
Your personal information will be passed to the Contributor and/or its authorised service provider to assist the Contributor to contact you about your investment enquiry. They are required not to use your information for any other purpose. Our privacy policy explains how we store personal information and how you may access, correct or complain about the handling of personal information.


Sign In or Join Free to comment