ASX 200 tumbles at open; News Corporation tanks over 10%

Highlights

• The benchmark ASX 200 index was trading 0.78% lower at 7,149.4 in the first 10 minutes of trading.
• Long-dated US Treasury yields climbed up while global equity markets continued their fall on Friday.
• Nine out of the 11 sectors were trading lower in the morning session.

The Australian share market opened on a lower note on Monday as concerns over aggressive rate hikes and economic slowdown continued to weigh on the market. The benchmark ASX 200 index was trading 0.78% or 56.2 points lower at 7,149.4 in the first 10 minutes of trading, while the ASX All Ordinaries index tumbled 0.89% to 7,401. The A-VIX shot up by 14.2% to 19.41 and is up by a massive 82.65% this year.

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Long-dated US Treasury yields climbed up while global equity markets continued their fall on Friday as market participants worried about the soaring inflation in the US, which is at a 40-year high.

Wall Street's main indices ended Friday’s session on a weak note, with the Dow Jones Industrial Average tumbling 0.3% to 32,899.37, while the S&P 500 slid 0.57% to 4,123.34. The NASDAQ Composite ended the session 1.4% lower at 12,144.66.

Market action

Coming to the top ASX 200 laggards, News Corporation (ASX:NWS) was the top loser, falling 10.48%, while Liontown Resources Limited (ASX:LTR) and REA Group Limited (ASX:REA) also featured on the list of losers, tumbling 3.98% and 3.92%, respectively. On the flip side, Polynovo Limited (ASX:PNV) and Westpac Banking Corporation (ASX:WBC) were the top gainers, rising 3.88% and 2.66%, respectively.

On the sectoral front, nine out of the 11 sectors were trading lower. The A-REITs sector was leading the fall with a 1.93% downtick, followed by a 0.98% fall in the financial space. The healthcare sector stood firm with a 0.84% rally in early trade.

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Newsmakers

1. Magellan Financial Group Limited (ASX:MFG)

• The group has agreed to sell 11.6% interest in Guzman y Gomez (Holdings) Limited (GYG) to a Barrenjoey Capital Partners entity.
• The sale would fetch the group approximately AU$140 million in proceeds.
• Magellan many also be entitled to another AU$6 million, subject to the performance of GYG.

2. Spirit Technology Solutions Limited (ASX:ST1)

• Spirit has entered into an agreement with Maret Infrastructure Pty Ltd to divest its wholesale fixed wireless infrastructure assets for up to AU$21 million.
• Maret Group and Spirit will also partner using Maret Group’s spectrum licensing assets and newly acquired network.
• Proceeds from the sale will be reinvested to accelerate growth and increase profitability in Spirit’s key SMB Technology and Cyber Solutions markets.

3. The Star Entertainment Group Limited (ASX:SGR)

• The Board has resolved to immediately suspend rebate programs for both domestic and international players across all its casinos until further notice.
• The Star will work with gaming regulators to address various identified risks as part of ongoing reviews of systems and processes.
• In light of COVID-related impacts on this part of the business, the decision to suspend rebate programs is not expected to have any material impact on earnings for FY22.

4. Suncorp Group Limited (ASX:SUN)

• Suncorp’s quarterly update for March 2022 confirms the Bank continued to make strong progress, particularly within the home lending portfolio, with AU$803 million of reported growth.
• Growth momentum also extended to the business lending portfolio, which grew AU$91 million during the March quarter and over AU$130 million in April.
• As of 31 March 2022, the Liquidity Coverage Ratio (LCR) and Net Stable Funding Ratio (NSFR) were 143% and 142% respectively.

5. AUB Group Limited (ASX:AUB)

• AUB Group has entered into an agreement to purchase Tysers, a leading Lloyd’s wholesale broker.
• the acquisition is consistent with AUB’s strategy to provide support for clients with international placement needs and to capture further economics in the broking value chain.
• The acquisition will be funded from proceeds of an AU$350 million Equity Raising, a placement of AU$176 million of AUB shares to the vendor of Tysers, and a new AU$675 million multi-currency debt facility.

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