AU Morning Wrap: ASX Opens Flat, Elanor Leaps After Challenger Asset Buy
G'day, mooers! Check out the latest news on today's stock market!
• Dow higher, S&P 500 sinks as recession jitters escalate
• ASX opens flat, Elanor leaps after its Challenger asset deal
• Stocks to watch: CSL, Elanor, Brambles
- Moomoo News AU
Wall Street Summary
Stocks mostly fell Wednesday as investors focused on fresh signs of a slowing U.S. economy.
The $S&P 500 Index (.SPX.US)$ dropped for a second day, closing down 10.22 points, or 0.2%, at 4090.38. The tech-heavy $Nasdaq Composite Index (.IXIC.US)$ dropped 129.47 points, or 1.1%, to 11996.86. The $Dow Jones Industrial Average (.DJI.US)$ was the outlier, inching up 80.34 points, or 0.2%, to 33482.72.
AU Market Watch
Australian shares held steady in a subdued start, following a mixed closing on Wall Street on the last day of trading before Easter.
Health stocks led gains with $CSL Ltd (CSL.AU)$ up 1.2 per cent. The major banks were mostly up, but miners, particularly lithium explorers, were a drag.
$BHP Group Ltd (BHP.AU)$ dipped 0.3 per cent but $Rio Tinto Ltd (RIO.AU)$ rose 0.6 per cent. $Fortescue Ltd (FMG.AU)$ held steady.
Challenger edged up 0.3 per cent after selling its $3.4 billion portfolio of Australian real estate assets to Elanor Investors. Elanor shares vaulted 17 per cent.
Brambles rallied 0.6 per cent. UBS increased the company's price target to $15.50, citing improving free cash flow.
Tech stocks came under pressure, following a 1.1 per cent fall on the Nasdaq.
Stocks to Watch
$Western Mines Group Ltd (WMG.AU)$: Western Mines Group has received encouraging results from its Mulga Tank nickel project which will enable the company to pursue further metallurgical testing.
The tests aim to demonstrate a viable large open pit at Mulga Tank.
$Challenger Ltd (CGF.AU)$: Challenger Financial is selling its Australian real estate business to $Elanor Investors Group (ENN.AU)$ for $42 million, to be received in new securities issued by Elanor.
The new investment management agreements between Challenger Life and Challenger's real estate third-party clients will give Elanor $3.4 billion of funds under management in retail, office and industrial assets.
Challenger's interest in Elanor post transaction completion will be about 18 per cent of total securities on issue.
$Brambles Ltd (BXB.AU)$: UBS has increased its Brambles price target to $15.50, from $15, and maintained the "buy" rating. It currently trades at $13.66.
UBS is wagering the company will improve liquidity over fiscal 2024 and 2025. "The lack of free cash flow, especially during the current period of strong [profit and loss] growth, is one of the key outstanding issues to be resolved before confidence rebuilds in the stock," said Andre Fromyhr, an analyst at UBS.
The brokerage house believes the current headwinds – lumber inflation and the volume of replacements – are temporary.
Listing: None
Source: Dow Jones Newswires, AFR
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