ASX Large Caps: Origin booms on takeover bid as Xero plunges; ASX down ahead of key US CPI
ASX large caps roundup 10 Nov 2022. Picture Getty
- The ASX dropped 0.5% on Thursday
- Origin Energy gets takeover offer, shares up 35%
- Key US inflation report scheduled tonight
Aussie shares fell 0.50% on Thursday as hopes of a quick Chinese recovery turn sour.
Overnight, Wall St fell around 2% across the board as concerns rise that China is losing the battle with COVID.
China’s vital manufacturing hub of Guangzhou is currently on lockdown as authorities rush to stamp out a widening Covid outbreak in the city of 19 million people. The city has become the latest epicentre of China’s Covid outbreak, logging more than 1,000 new cases for five straight days.
Stock markets across Asia fell on Thursday, with the HangSeng down 2% and Nikkei by 1%.
Investors are also nervously awaiting tonight’s crucial inflation report in the US.
Economists are expecting US CPI to moderate slightly in October, after an 8.2% headline in September.
Robert Tipp, Chief Investment Strategist at PGIM Fixed Income, believes that inflation will improve and the global rate hiking cycle will end by early 2023.
“Continuing high inflation readings and strong job growth are likely to keep central banks aggressively raising rates and fueling hard landing fears,” Tipp said.
“Further ahead, however, the inflation picture may be set to improve as both real estate and energy prices may have passed their peak levels, and supply demand frictions are showing signs of abating.”
Meanwhile, the crypto market is in a state of panic after Binance ditched its plans to rescue FTX overnight.
BTC is currently trading at US$16,350, while ETH is at US$1,169. Both are down by 10% in the last 24 hours.
On the ASX, Energy stocks paced the losers on Thursday while the Utilities sector gained 13% after heavyweight Origin Energy (ASX:ORG) said it received a takeover offer from Brookfield and EIG’s at $9 per share.
The deal would see Brookfield run the energy business, with EIG’s MidOcean Energy to take on its LNG business.
The power provider’s shareholders are currently gawking at the 54.9% offer, which values its shares are $18.4 billion buckaroos. ORG shares were up 35%.
Looking ahead to tonight’s Wall St session, the US October CPI report is due out, along with US Wholesale Inventories data.
BIG CAP WINNERS
Swipe or scroll to reveal the full table. Click headings to sort.
| Code | Name | Price | % Change | Volume | Market Cap |
|---|---|---|---|---|---|
| ORG | Origin Energy | 7.875 | 36% | 42,942,221 | $10,009,163,969 |
| PPT | Perpetual Limited | 32.52 | 12% | 956,261 | $1,667,093,589 |
| SFR | Sandfire Resources | 4.19 | 5% | 5,540,436 | $1,640,726,432 |
| CPU | Computershare Ltd | 27.17 | 5% | 1,941,090 | $15,696,962,736 |
| EVN | Evolution Mining Ltd | 2.435 | 4% | 18,898,136 | $4,312,048,217 |
| CEN | Contact Energy Ltd | 6.8 | 2% | 5,065 | $1,662,132,615 |
| WOW | Woolworths Group Ltd | 33.795 | 2% | 1,689,309 | $40,387,004,030 |
| NXT | Nextdc Limited | 8.81 | 2% | 994,442 | $3,961,341,921 |
| A2M | The A2 Milk Company | 5.825 | 2% | 2,634,925 | $4,249,604,471 |
| DEG | De Grey Mining | 1.24 | 2% | 4,989,066 | $1,879,771,016 |
| RMD | ResMed Inc. | 33.09 | 1% | 683,907 | $13,440,173,346 |
| LIC | Lifestyle Communit. | 17.73 | 1% | 217,052 | $1,827,448,890 |
| COH | Cochlear Limited | 202.485 | 1% | 59,566 | $13,131,943,278 |
Perpetual (ASX:PPT) surged 11% after receiving a better offer from its takeover suitors PEA Private Equity Fund VIII and Regal Partners.
Under the revised offer, the consortium is now offering $33 cash per share, a 10% increase from the first offer.
Computershare (ASX:CPU) rose 5% after upgrading its earnings per share growth guidance for 2023 to 90%.
CPU also upgraded its margin income forecast to US$800 million, which is US$280 million above its August forecast.
BIG CAP LOSERS
Swipe or scroll to reveal the full table. Click headings to sort.
| Code | Name | Price | % Change | Volume | Market Cap |
|---|---|---|---|---|---|
| PDL | Pendal Group Ltd | 3.87 | -12% | 8,327,222 | $1,682,026,261 |
| XRO | Xero Ltd | 65.43 | -10% | 1,573,158 | $10,903,953,565 |
| SMR | Stanmore Resources | 2.635 | -8% | 2,206,446 | $2,568,937,839 |
| SQ2 | Block | 90.14 | -6% | 128,677 | $3,495,956,289 |
| DTL | Data#3 Limited | 6.41 | -6% | 441,711 | $1,051,274,451 |
| PDN | Paladin Energy Ltd | 0.8025 | -4% | 12,086,827 | $2,502,671,497 |
| PXA | Pexagroup | 14.085 | -4% | 80,509 | $2,613,782,115 |
| SGM | Sims Limited | 11.605 | -4% | 591,417 | $2,342,828,496 |
| NHC | New Hope Corporation | 5.345 | -4% | 8,848,045 | $4,893,519,033 |
| IMU | Imugene Limited | 0.1825 | -4% | 12,482,025 | $1,204,047,981 |
| VUL | Vulcan Energy | 7.55 | -4% | 183,500 | $1,126,615,466 |
| SYR | Syrah Resources | 2.565 | -4% | 2,224,066 | $1,790,423,796 |
| MFG | Magellan Fin Grp Ltd | 9.06 | -4% | 1,463,689 | $1,719,844,960 |
| BRN | Brainchip Ltd | 0.5925 | -4% | 5,776,302 | $1,062,020,219 |
| PLS | Pilbara Min Ltd | 5.3 | -4% | 13,742,215 | $16,470,471,034 |
Xero (ASX:XRO) fell 9% after the company missed its EBITDA forecasts.
Xero reported a 30% increase in net revenue to NZ$658.5 million, beating analysts’ expectations, but its bottom line EBITDA of NZ$108.6 million missed expectations of around NZ$143 million.
Pendal Group (ASX:PDL) plunged 11% on Thursday.
Pendal has agreed to be acquired by Perpetual, and says that it intends to proceed with the transaction despite requests from Perpetual for a delay (pending Perpetual’s own takeover offer).
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