Australian Investment Blog

• The ASX 200 sold off heavily today, with the index finishing down 96 points after hitting its low of 113 points at around 2.30pm.
• The market got hit hard at 11:30 a.m, when selling concentrated to Bluechip’s, such as banks, Telstra and the supermarket owners, plus gold stocks. The selling mainly due to an impending US rate rise and weak Chinese trade data.
• The sea of red was dominated by the resources, as fund managers look to raise funds for the Santos placement, BHP Billiton (BHP) was sold down, hitting a low of $21.42 on the close. These low's have not been seen since November 2008. RIO Tinto (RIO) surprisingly held up from its low on Friday ($48.89) finishing the day at $49.00, down $1.80.
• The banks were also weak, but not to the same extent. Commonwealth Bank (CBA) had a low today of $75.02 and closed down 75c to $75.58, down $1.32. Australia New Zealand Bank (ANZ) closed down 61c to $25.36, National Australia Bank (NAB) closed down 57c to $28.08 and Westpac Bank (WBC) down 36c to $31.29.
• Gold miners were hit particularly hard after the precious metal's price slid nearly 2 per cent to below $US1100 an ounce on Friday in the wake of strong US jobs numbers, which strengthened the case for a Fed rate hike in December. Newcrest (NCM) down 5.5% to $11.29, Regis Resources (RRL) down 7.3% to $1.85 and Oceanagold (OGC) down 4.6 % to finish at $2.50. We are watching this space closely for future opportunities.
• As mentioned above, the big corporate news is Santos who announced the appointment of a new CEO alongside $3.5 billion of capital initiatives, including an asset sale, a $500 million private placement, and a $2.5 billion capital raising. Santos will use the proceeds to reduce its heavy debt burden that has exposed the company to predators following a collapse in the oil price. The new Santos boss will be Kevin Gallagher, who currently heads up engineering services group Clough. Gallagher will start in "early 2016" the company said. The cash call is in the form of a fully underwritten accelerated pro-rata renounceable entitlement offer with retail entitlements trading and is priced at $3.85, well below the last trading price of $5.91. The company also announced a $500 million private placement at a 15 per cent premium to last close to an affiliate of the China-based international private equity firm, Hony Capital. Finally, the Adelaide-based gas company has announced it has earned $520 million from the sale of an interest in Kipper gas field to Mitsui E&P Australia. Santos also announced a new dividend framework, setting the payout ratio at a minimum of 40 per cent of underlying net profit. The company said it will target a payment of 5 cents per share for the 2015 final dividend. Market Matters are watching this all very closely with an option position currently on this stock.

Best Sector – Health Care
Worst Sector – Materials

Winners
Syrah Resources Ltd (SYR) +$0.15, or (+4.8%) to $3.29
Henderson Group PLC (HGG) +$0.17, or (+2.8%) to $6.26
Kathmandu Holdings Ltd (KMD) +$0.035, or (+2.5%) to $1.44
Magellan Financial Group Ltd (MFG) +$0.23, or (+1.0%) to $22.81

Losers
Regis Resources Ltd (RRL) -$0.145, or (-7.3%) to $1.85
BHP Billiton Ltd (BHP) -$1.28, or (-5.6%) to $21.42
Newcrest Mining Ltd (NCM) -$0.66, or (-5.5%) to $11.29
Origin Energy Ltd (ORG) -$0.29, or (-5.4%) to $5.11

All figures contained from sources believed to be accurate. MarketMatters does not make any representation of warranty as to the accuracy of the figures and disclaims any liability resulting from any inaccuracy. Prices as at 9/11/2015. 4.14PM.

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