M&A Activity helps the market nudge higher (STO, FXJ, DHG)
Early weakness was soon bought this morning as the market brushed off a poor overnight lead and cashed up investors showed some support for a market that had fallen 136pts/2.25% in 5-days. The energy names sprung back to life today after a proposal was launched at Santos (STO) for a 21% premium to yesterday’s close price. The big names all closed higher, STO rallying 13%, still over 7% below the reported bid, despite the oil price falling overnight and remaining little changed in Asian trade.
Santos (STO) Weekly Chart
In other M&A news, Domain’s de-merger from Fairfax (FXJ) was completed today, with Domain commencing trading under the code DHG. Fairfax shareholders received 1 DHG share for every 10 in FXJ, representing around $0.35 value per Fairfax share. Domain opened well above the valuation, however was sold off over the day, closing at $3.69. Fairfax fell 31%, falling 33.5c, holding some of Domain’s value. The printed media space is facing a variety of challenges and costs continue to rise so we struggle to see value at this stage.
Fairfax (FXJ) Daily Chart – Rebased for the demerger
Domain (DHG) Intraday Chart
Consumer staples struggled again today as investors continue to digest the recent announcement from Amazon, Wesfarmers and Woolworths both closed around 1% lower. Energy was the best sector, followed by the tech names. Overall, a range today of +/-37 points, a high of 5953, a low of 5928 and a close of 5943, adding 9 points or +0.16%.
ASX 200 Intra-Day Chart
ASX 200 Daily Chart
Have a great night
The Market Matters Team
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