AU Morning Wrap: ASX Climbs, Coles to Acquire Two Milk Processing Facilities

Moomoo News AU wrote a column · Apr 3, 2023 07:45

G'day, mooers! Check out the latest news on today's stock market!
• Nasdaq rallies 6.7% in March, oil prices surge
• ASX up 0.8%
• Stocks to watch: Coles, Lake Resources, Sonic Healthcare
- Moomoo News AU

AU Morning Wrap: ASX Climbs, Coles to Acquire Two Milk Processing Facilities

Wall Street Summary

Stocks ended the quarter on a positive note, after a stormy three months in which markets were whipsawed by strains in the banking system as well as shifting outlooks for inflation and interest rates.

Government data early Friday showed the Federal Reserve's preferred measure of inflation, known as the core personal-consumption expenditures price index, slowed in February, lifting hopes the central bank could limit its campaign to curb inflation sooner than originally expected.

The $S&P 500 Index (.SPX.US)$ ended the day 58.48 points higher, or 1.4%, at 4109.31. The $Dow Jones Industrial Average (.DJI.US)$ closed up 415.12 points, or 1.3%, at 33274.15. The tech-heavy $Nasdaq Composite Index (.IXIC.US)$ increased 208.44 points, or 1.7%, to 12221.91.

AU Market Watch

The $S&P/ASX 200 (.XJO.AU)$ was up 0.79 per cent in early trade.

Stocks to Watch

$Lake Resources NL (LKE.AU)$: Lithium explorer Lake Resources reports its direct lithium extraction technology (DLE) provided by partner Lilac Solutions has produced lithium carbonate purity grades greater than 99.8 per cent at its Saltworks testing facility in Canada.

The processing plant remains at the demonstration stage and the company said it's in the process of evaluating project timelines and capital costs.

Lake expects to complete a definitive feasibility study for its Kachi Project by mid-2023.

The stock has collapsed in line with lithium carbonate prices in 2023 and is down 41.5 per cent year to date to last close at 44 cents. At the height of the lithium mania in April 2022 it soared to $2.45.

$Fonterra Shareholders Fund (FSF.AU)$: Fonterra Co-operative has downgraded its forecast farmgate milk price range for the 2022-2023 season, reflecting short-term demand for products that inform the Co-op's milk price being softer than expected.

Fonterra now expects prices to be in the range of $NZ8.00 to $NZ8.60 per kilogram of milk solids, down from $NZ8.20 to $NZ8.80 per kgMS.

African focused gold producer Perseus Mining has refinanced its existing syndicated debt facility to a $US300 million revolving corporate facility.

The increased facility is available for general corporate purposes, subject to the satisfaction of certain customary conditions.

Combined with Perseus's December 31 net cash position of $US405 million, it provides the company with more than $US705 million of available liquidity.

$Telix Pharmaceuticals Ltd (TLX.AU)$: Telix Pharmaceuticals has filed a marketing authorisation application in the UK for its Illuccix 25 micrograms kit for radiopharmaceutical preparation for positron emission tomography (PET) imaging of prostate cancer.

The review period for the MAA with the UK Medicines and Healthcare products Regulatory Agency follows a 150-day national application procedure.

The company is also in the process of filing a separate decentralised MAA application for the European Union.

$Coles Group Ltd (COL.AU)$: Coles has agreed to acquire two automated milk processing facilities from Saputo Dairy Australia (SDA) for around $105 million.

Each facility has the capacity to process around 225 million litres a year, and are predominantly used today to process Coles Own Brand 2L and 3L milk.

The processing facilities are located in Laverton North (VIC) and Erskine Park (NSW) close to Coles' distribution centres.

SDA site-based employees at both facilities will be offered employment contracts with Coles.

$Sonic Healthcare Ltd (SHL.AU)$: Sonic Healthcare has agreed to buy Diagnosticum group of laboratories for €190 million ($307.9 million).

The deal will be funded in euro from Sonic's existing cash and debt facilities, with the majority of the purchase price being tax deductible in Germany over 15 years as goodwill amortisation.

Diagnosticum employs 25 pathologists and operates 15 laboratories across its regional geography in Europe, including several hospital laboratories and an advanced genetics laboratory in Frankfurt.

The business expected to generate revenues of €65 million in FY24.