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Highlights
- S&P/ASX 200 Index edges up slightly to 8,230.9 points in afternoon trade, battling to remain in positive territory.
- CAR Group, Myer Holdings, and Neuren Pharmaceuticals lead the market drag with notable share price declines.
- Weak trading updates, valuation downgrades, and delayed regulatory approvals contribute to investor caution.
The S&P/ASX 200 Index is facing significant resistance in maintaining positive momentum today. In afternoon trade, the benchmark index inched up to 8,230.9 points, reflecting a cautious market sentiment. Several key stocks are exerting downward pressure on the market. Here’s a closer look at the major decliners and the reasons behind their struggles.
CAR Group Limited (ASX:CAR)
Shares of CAR Group Limited have fallen by 1.5%, trading at AU$37.98. The decline appears to be linked to a broker note released by Ord Minnett earlier today. According to the note, the brokerage downgraded CAR Group to a "hold" rating with a revised price target of AU$39.00.
The downgrade was attributed to valuation concerns after a strong rally on Tuesday pushed the stock to levels considered fairly valued. While CAR Group has performed well recently, analysts believe the current price reflects its near-term potential, leading to reduced buying interest.
Myer Holdings Ltd (ASX:MYR)
Myer Holdings shares continued their downward trajectory, dropping an additional 3% to 81.7 cents. This marks a nearly 30% decline in the retailer’s stock price since last week.
The sell-off follows the release of a disappointing trading update, which revealed that group comparable sales for the 22 weeks ending December 28 were flat compared to the prior year. Total sales were down 0.8%, amounting to approximately AU$1.59 billion. Additionally, the company reported a 25% drop in earnings before interest and tax (EBIT) to AU$48 million, driven by weaker margins.
Investors remain concerned about the company’s ability to recover amidst challenging trading conditions and rising competitive pressures in the retail sector.
Neuren Pharmaceuticals Ltd (ASX:NEU)
Neuren Pharmaceuticals shares tumbled 9% to AU$10.94, following news regarding its partner, Acadia Pharmaceuticals (NASDAQ:ACAD). This morning, Acadia announced the submission of a Marketing Authorization Application (MAA) to the European Medicines Agency (EMA) for trofinetide, a treatment for Rett syndrome in patients aged two years and older.
While the application marks progress, Acadia indicated that potential approval might not come until the first quarter of 2026. For some investors, the longer-than-expected timeframe for regulatory approval in the European Union tempered optimism. If approved, trofinetide would become the first and only approved therapy for Rett syndrome in the EU, but the uncertainty surrounding the timeline weighed heavily on Neuren’s stock today.
