• ASX closes down 1.54% setting a 20-day low with hopes of a Christmas rally fading
  • Japan stocks tumble after Bank of Japan adjusts its bond yield cap
  • Johns Lyng Group COO Lindsay Barber sells down ~$26 million worth of shares

The benchmark S&P/ASX200 closed down 1.52% after falling 0.3% at the open and continuing to lose ground throughout the day setting a new 20-day low.

The ASX followed global markets on a downward trajectory with the US S&P 500 closing at its lowest level in more than a month, dragged down by falls in the big tech firms.

Investors aren’t feeling optimistic going into Christmas as hawkish statements from global central banks weigh heavily and China sees a big surge in Covid-19 cases.  The big news this afternoon comes from the Bank of Japan (BOJ) which has joined the hawk party.

The BOJ has modified its yield curve control tolerance range but at this stage is continuing to hold its ultra-low interest rates steady.

Japan’s central bank said it will expand the range of 10-year Japan government bond yield fluctuations from its current +/- 0.25 percentage points to +/- 0.5 percentage points.

The adjustment will be done to “improve market functioning and encourage a smoother formation of the entire yield curve, while maintaining accommodative financial conditions,” the BOJ said.

“Since early spring this year, volatility in overseas financial and capital markets has increased and this has significantly affected these markets in Japan.”

Japan has been the developed world’s last country to hold out on raising ultra low interest rates but its announcement is a signal that its central bank is getting nervy and may change its policy course.

So how did markets react?  Well, the news sent the Australian 10-year government bond yields soaring to 3.71%.

The Nikkei 225 fell 2.5%, leading losses in the Asia-Pacific region, and the Topix fell 1.19% in its afternoon session.

In South Korea, the Kospi fell 0.66%. The Heng Seng was down 1.36% and CSI 300 dropped 1.15%.

The Japanese yen strengthened by more than 2% against the US dollar and is currently standing at 133.16.

On the ASX all sectors were in the red with IT stocks leading the laggards, down 4.22%, consumer discretionary losing 3.51% and the real estate sector falling 3.42%

 

BIG CAP WINNERS

Swipe or scroll to reveal the full table. Click headings to sort.

Wordpress Table Plugin

 

It was not a day of big gains among ASX large caps. Insurance broking and underwriting agency AUB Group (ASX:AUB) was back on the winners list today after it saw its share value fall last week after noting there had been wide disparity in analysts’ views regarding the split between Underlying Net Profit After Tax (UNPAT) in H1 FY23 and H2 FY23. 

To reduce this disparity, AUB had put out an announcement saying it wished to notify the market of expectations for performance in H123 and H223. 

The company said it expected UNPAT in the range of $41.5 million to $44.5 million for 1H23, representing 35.5% to 45.3% growth over H1 FY22. AUB expected UNPAT in the range of $66 million to $70.5 million for H2 FY23.

 

BIG CAP LOSERS

Swipe or scroll to reveal the full table. Click headings to sort.

Wordpress Table Plugin

 

Johns Lyng Group (ASX:JLG) was the biggest laggard on the ASX 200 after its chief operating officer Lindsay Barber disclosed the sale of four million shares, ~31% of his prior holding.

JLG said the sale, worth $25m, was undertaken to diversify Barber’s personal asset portfolio.

“Mr Barber has informed the company that he has no intention of selling more shares within the next 12 months,” JLG said.

The insurance builder also re-confirmed its current earnings guidance for FY23 including sales revenue of $1,030.9m (including BaU sales revenue of  $930.4m, a 27.4% increase on FY22).

CEO and managing director Scott Didier sold 4 million shares for $25 million on October 10.

No details were released on Didier’s sale but the news also rattled the market and saw the JLG share price plunge ~15%.

The JLG share price is down more than 33% year to date.

 

JLG Share price today:

 

Read MoreBondsShares

Featured Companies

You might be interested in