The Australian sharemarket took a break from three-day losing streak on Monday, with many sectors gaining ground, while major casino company Crown Resorts is the dominant player after a $ 8bn bid.
The S&P / ASX200 closed 0.66 percent above 6752.5 while the All Ordinaries Index increased 0.51% to 6995.
OpenMarkets Group chief executive Ivan Tchourilov said the local bourse marched to its own beat after US markets closed mixed on Friday.
What Drove The Market Up?
Crown received an unsolicited, non-binding seven-year proposal from New York-based Blackstone Group for $ 11.85 each, sending its shares up 21.4 percent to $ 11.97.
The offer is subject to conditions, including a legal guarantee that the Blackstone-owned Crown is deemed eligible to own and operate the casinos in Sydney, Melbourne and Perth.
The board has not yet made a recommendation to shareholders – the biggest being reclusive billionaire James Packer — and is assessing the proposal. Blackstone already has a 9.99 per cent stake in Crown.
It comes just two days before the company faces a royal commission in Victoria over its embezzlement scandal.
Another major cause was the Myer chain, which earned 5.97 percent to 35.5 cents.
“The stock looks attractive at current levels with the huge buy pressure coming today,” Mr Tchourilov said.
“Their stores were obviously in trouble during the COVID era, but online marketing has done very well, which has kept them going.
“Meanwhile, Myer’s short-term debt – which must be paid within 12 months – is about $ 650m, and it has $ 300m or more of temporary income and receivables, for the same period.
“Obviously they are still concerned about the balance, which makes it difficult to integrate investment strategies into them.
Market Sentimenet
Online retailer Kogan was lagging behind, delivering 3.46 percent to $ 13.67.
The building materials sector is weakened after falling steel prices. Rio Tinto lost 1.15 percent to $ 107.81, BHP fell 0.89 percent to $ 44.50 and Fortescue fell 4.25 percent to $ 19.16.
CommSec analyst James Tao said there were continuing concerns about Chinese demand for Australia’s key export.
“There’s a number of steel mills that will be shutting down production or easing production for environmental reasons,” Mr Tao said.
Most insurers fell by between 2 and 3 per cent due to the foul weather in NSW and southeast Queensland.
IAG said it had received more than 2100 claims as of Sunday night and it was too early to accurately determine the net cost of the flooding and storms.
IAG shares dropped 2.26 per cent to $4.75.
