ASX 200 opens higher; IAG falls after ASIC takes legal action

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ASX 200 opens higher; IAG falls after ASIC takes legal action

 ASX 200 opens higher; IAG falls after ASIC takes legal action
Image source: bluebay,Shutterstock

Highlights

  • The ASX 200 was trading 0.8% up at 7,371 in early trade.
  • US shares closed higher on Thursday as strong bank earnings instilled confidence in investors.
  • The market breadth has been favouring the bulls today, with 9 out of the 11 sectors trading higher.

On the last day of the week, the Australian share market opened on a higher note, supported by gains in local miners and energy stocks on the back of rising commodity and crude oil prices, while at the same time tracking a strong closing on Wall Street. The ASX 200 was trading 0.8% up at 7,371 in early trade.

Stock prices flashing on a trading screen

Image Source: © Embe2006 | Megapixl.com

US shares closed higher on Thursday as strong bank earnings instilled confidence in investors, increasing their risk appetites. The data on the labour market and inflation also helped soothe worries about the outlook for higher interest rates.

The Dow Jones Industrial Average closed 1.56% up to 34,910.56, while the S&P 500 surged 1.71% to end at 4,438.26 points. The NASDAQ Composite gained 1.73%, to 14,823.43.

Read More: US stocks close higher on strong earnings reports

How has the market performed so far?

As of 11:00 AM AEDT, the ASX 200 had retraced a bit from the day’s high of 7,373.32 and was trading 0.55% up at 7,352.2. The ASX All Ordinaries index was trading 0.56% or 42.7 points up at 7,662.9.

Top 5 ASX gainers and losers

Data Source: ASX Website (as of 15 October 2021, 11:00 AM AEDT)

The top ASX 200 contributors were ARB Corporation Limited (ASX:ARB) and Netwealth Group Limited (ASX:NWL), both gaining 7.36% and 4.1%, respectively. On the flip side Pendal Group (ASX:PDL) and Platinum Asset Management Limited (ASX:PTM) were the top losers, shedding 9.8% and 5.9%, respectively. Insurance Australia Group Limited (ASX:IAG) also opened with a gap down after the ASIC initiated a probe against the insurer over its alleged misleading and deceptive conduct.

The market breadth has been favouring bulls today, with 9 out of the 11 sectors trading higher. The materials and IT sector were leading the pack, both gaining 1.2%, while the Utilities and Consumer Staples sectors were trading with a minor downtick.

Newsmakers

  1. Pendal Group Limited (ASX:PDL)
  • The group’s recent deal to acquire Thompson, Siegal & Walmsley has boosted its funds under management to AU$139.2 billion.
  • According to the management, the acquisition is proving to be a value accretive move for shareholders.
  • Before the acquisition, the Group was managing around AU$106.7 billion.
  1. Qantas Airways Limited (ASX:QAN)
  • The company has agreed to sell surplus land in south Sydney’s Mascot for AU$802 million.
  • Qantas is making some arrangements to relocate some functions that are performed on that land.
  • The proceeds will be used to reduce debt obligations of the company.
  1. Insurance Australia Group Limited (ASX:IAG)
  • The Australian Securities and Investment Commission is proceeding to sue IAG over its alleged misleading and deceptive conduct.
  • The company offered discounts on some of its offerings that were based on inflated premiums.
  • It is alleged that the company used algorithms to hike premiums so that discounts would not be affected much.
  1. Rio Tinto Limited (ASX:RIO)
  • The management has reduced iron ore production guidance to 320 – 325 million, from 325 – 340 million for FY22.
  • It has quoted tough operating conditions in the September 2021 quarter as a reason for pessimistic guidance.
  • Copper production for the September quarter finished 3% down to 209 million tonnes.
  1. Treasury Wines Estate Limited (ASX:TWE)
  • The management communicated that its execution plans in on-premise channels are behind schedule due to Melbourne and Sydney lockdown.
  • The recovery of the luxury wines channel in the Americas has also been delayed.
  • It has also warned of the global supply chain disruptions with shipping delays.

Read More: Three ASX penny stocks benefiting from crude oil rally

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