ASX 200 kickstarts August on a higher note

Summary

  • At the opening tick, the ASX 200 is trading 0.32% up, at 7,415.9.
  • On Friday, US stocks closed lower, retracing further from record highs as an underwhelming earnings report from Amazon spoiled investors’ mood.
  • Oil Search has agreed to a merger with Santos for a total of 38.5% stake in the combined entity.

On the first session of August 2021, the Australian share market has opened higher, giving investors some relief from Friday’s sell-off. At the opening tick, the ASX 200 is trading 0.32% up, at 7,415.9. Investors remain confident ahead of the corporate earnings season, replacing some gloom surrounding surging COVID-19 cases in Australia.

 Image Source: Copyright © 2021 Kalkine Media

On Friday, US stocks closed lower, retracing further from record highs as an underwhelming earnings report from Amazon spoiled investors’ mood. The e-commerce giant’s shares sank 7.6% - their biggest daily percentage drop in more than a year.

The Dow Jones fell 0.42% to 34,935.47, while the S&P 500 lost 0.54% to 4,395.26. The NASDAQ Composite was down 0.71% to 14,672.68. The CBOE VIX index shot up 3.05% to 18.24.

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How has the market performed so far?

As of 10:30 AM AEST, the Australian benchmark index, the ASX 200 has continued its rally for the day and is trading 0.85% up at 7,455.1. The ASX All Ordinaries index has also surged higher by 0.9% to 7,732.8, supported by Afterpay Limited (ASX:APT) and Auteco Minerals Limited (ASX:AUT).

The Early Trades || Will ASX 200 retain its momentum with Afterpay under the spotlight?

The market breadth for the day is looking quite positive as nine out of the 11 sectors are trading in green, with IT sector gaining a massive 7.33% intraday gain, supported primarily by Afterpay. Materials sector is losing the most with a 0.46% loss.

Top gainers for the day so far are Afterpain Limited (ASX:APT), clocking a 25.72% gain, followed by Pilbara Minerals Limited (ASX:PLS), which had a 8.76% gain.

Data Source: ASX Website (2 August 2021, as of 10:30 AM AEST)

Top index draggers in the opening session are ALS Limited (ASX:ALQ) and Pro Medicius Limited  (ASX:PME), both losing 4.32% and 2.98%, respectively. The A-VIX index is trading 2.3% down to 12.18.

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Newsmaker

Ramelius Resources Limited (ASX:RMS) has divested its interest in Kathleen Valley lithium royalty to Liontown Resources for a total of AU$30.25 million. The management would be using the proceeds to fund the company’s growth.

Oil Search Limited (ASX:OSH) has agreed to a merger with Santos Limited (ASX:STO). The deal would give Oil Search a total of 38.5% stake in the combined entity, which would be equal to a premium of approximately 20% on the company’s share closing price in the middle of July 2021.

Cedar Woods Properties Limited (ASX:CWP) has acquired two properties in Melbourne’s western growth corridor for a total of AU$63.5 million. The site in Fieldstone was bought for AU$33 million and 14.6-hectare Fraser Rise site was purchased for AU$30.5 million.

 Image Source: Copyright © 2021 Kalkine Media

Mineral Resources Limited (ASX:MIN) has entered into an agreement to purchase a 40% stake in Red Hill Iron’s Red Hill iron ore joint venture for a total consideration of AU$400 million. The first instalment of AU$200 million would be paid upon the completion of the sale and the remaining amount, after the first commercial shipment of iron ore departs from the port. 

Image Source: Copyright © 2021 Kalkine Media

Afterpay Limited (ASX:APT) reported a 102% increase in the underlying sales on a constant current basis in FY21, primarily driven by a massive 242% increase in the sales of Clearpay. Total revenue for the group rose 88% to AU$925 million for FY21. 

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