March 26, 2019 / 12:57 AM / 5 months ago

Australia shares checked by growth woes, Wesfarmers slides on M&A; NZ up

* Wesfarmers slumps after making $1.1 bln bid for Lynas

* Gold stocks rally on safe-haven buying

* Challenger soars on top shareholder’s intention to up stake

By Aditya Soni

March 26 (Reuters) - Australian shares were held back on Tuesday by lingering concerns about a potentially sharper global economic slowdown, while gains for miners were partially offset by losses in Wesfarmers in the wake of its bid to acquire rare earths miner Lynas.

The S&P/ASX 200 index was off 0.1 percent or 4 points to 6,122.20 by 0027 GMT, having slumped 1.1 percent on Monday.

Wesfarmers Ltd tumbled 3.8 percent to a near three-week low and accounted for most of the losses on the benchmark as investors dumped the retail-to-chemicals conglomerate after it made a A$1.50 billion ($1.07 billion) buyout offer for Lynas Corp Ltd.

“The acquisition is definitely not one of the top targets we would have picked for Wesfarmers,” said Mathan Somasundaram, market portfolio strategist at Blue Ocean Equities.

“It does not give market confidence as it as an asset with a fair amount of regulatory risk in an area where they (Wesfarmers) have not been able to get it right and I do not think Wesfarmers has a huge competitive advantage in managing this asset than what has been done,” he added.

Lynas shares were on a trading halt.

Broad market sentiment in the region was also weighed down by persistent worries about the health of the global economy after weak U.S. factory data last week prompted an inversion of the U.S. Treasury yield curve - historically seen as a signal of a recession.

Santos Ltd, the country’s No. 2 independent gas producer, dropped 1.7 percent to its lowest since March 11, while Woodside Petroleum Ltd AX> fell to a near two-week trough.

Moving in the opposite direction, shares of iron ore miners rose on concerns about supply of the steelmaking commodity after a Brazilian court issued an order that will delay the restart of a major Vale SA mine.

Fortescue Metals Group Ltd firmed 1.5 percent, while BHP Group Ltd advanced 0.9 percent.

Gold stocks, the sole gainers in the previous session, extended their rally on safe-haven appeal.

Saracen Mineral Holdings Ltd rose 3.5 percent to its highest level since Feb. 21.

Elsewhere, investment manager Challenger Ltd climbed as much as 8.9 percent and was the top performer on the benchmark after announcing top shareholder MS&AD Insurance Group Holdings Inc will raise its stake in the firm to over 15 percent and seek a board seat.

In New Zealand, the benchmark S&P/NZX 50 index rose 0.2 percent or 17.60 points to 9,536.91.

Gains were underpinned by a jump in Spark New Zealand Ltd which climbed 2.6 percent to a near three-week high.

Reporting by Aditya Soni in Bengaluru Editing by Shri Navaratnam

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