ASX weekly: Telstra, Rio Tinto down, News Corp up as share market eyes off boom-time heights

Telstra suffered a billion-dollar value drop, but a week of strong trading elsewhere saw the Australian share market coming close to smashing boom-time records.
ASX 200_type of investment options
Source: Pavel Ignatov (Shutterstock)

The All Ordinaries Index finished at 6,734 points (up 1.53%) and the S&P/ASX 200 at 6,651 points (up 1.48% on the previous week’s close), almost eclipsing the October 2007 highs of 6,779.1 and 6,754.1 points respectively.

The week’s biggest losers included Telstra Corporation, which copped a $1.07 billion reduction in market value, after the company’s share price slipped from $3.87 on June 14 – the highest level it has been since 2017 – to $3.78 at Friday’s close (down 2.3% for the week).

The company’s fall reflected an overall drop in the telecommunications sector, which fell 1.84% to close at 1,320 points.

Media company News Corp, publisher of titles such as The Australian and news.com.au, was among the companies enjoying growth, climbing 14.7% to $20.12 a share after the announcement that it could possibly sell off in-store marketing company News America Marketing (NAM), “as part of efforts to simplify the company’s structure”.

ASX 200 Listed Companies – Top 5 Biggest Share Price Gains and Losses (14/06/2019 to 21/06/2019)
Biggest Gains Biggest Losses
Rank Company Closing Share Price % Change Rank Company Closing Share Price % Change
1 Emeco Holdings (EHL) $2.21 25.2% 1 Vocus Group (VOC) $3.19 -26.8%
2 Nanosonics (NAN) $5.73 16.2% 2 Pilbara Minerals (PLS) $0.58 -17.7%
3 News Corporation (NWS) $20.12 14.7% 3 Syrah Resources (SYR) $0.88 -15.4%
4 Nearmap (NEA) $4.11 14.5% 4 McMillan Shakespeare (MMS) $12.41 -11.5%
5 Bingo Industries (BIN) $2.38 12.8% 5 Caltex Australia (CTX) $23.54 -11.1%
Prepared by Canstar. Prices taken as of week to week close.

News Corp chief executive Robert Thomson said the NAM business had been “transformed from one based on newspaper inserts to one of the leading in-store marketing companies in the US”, with a database of millions of shoppers and extensive purchase data, although commentators have noted that its sales had begun to decline in recent years.

It was also an impressive week for much of the mining sector, with BHP Group and Newcrest Mining making the “biggest gains” list for value. However, fellow mining giant Rio Tinto copped a billion-plus decline in market value, dropping 3.8% to wipe $1.48 billion off its market value, after it downgraded its iron ore outlook.

Mining machinery hire firm Emeco Holdings topped the share price gain list, growing by 25.2% to $2.21. After an early-year fall due to weaker-than-expected growth projections, the latest share results come after the company released an investment outlook stating it was “committed to its aggressive deleveraging path”. The document stated that growth projections for rental machinery was strong, as miners were holding off from purchasing equipment outright as a way of reducing their financial risk.

ASX 200 Listed Companies – Top 5 Biggest Market Cap Gains and Losses (14/06/2019 to 21/06/2019)
Biggest Gains Biggest Losses
Rank Company $ Change in Market Cap Closing Share Price % Change in Share Price Rank Company $ Change in Market Cap Closing Share Price % Change in Share Price
1 Commonwealth Bank of Australia (CBA) $3,983,038,891 $82.02 2.8% 1 RIO Tinto (RIO) -$1,477,440,532 $101.36 -3.8%
2 Transurban Group (TCL) $2,100,109,201 $15.30 5.4% 2 Telstra Corporation (TLS) -$1,070,396,807 $3.78 -2.3%
3 Woodside Petroleum (WPL) $1,984,641,284 $37.15 6.1% 3 Caltex Australia (CTX) -$731,641,355 $23.54 -11.1%
4 BHP Group (BHP) $1,855,886,378 $40.93 1.6% 4 Vocus Group (VOC) -$728,048,667 $3.19 -26.8%
5 Newcrest Mining (NCM) $1,460,103,243 $32.02 6.3% 5 The a2 Milk Company (ATM) -$602,615,784 $13.22 -5.8%
Prepared by Canstar. Prices taken as of week to week close. 

 

Telco Vocus Group’s woes continue, with its share price slipping 26.8% to $3.19 – a loss of $728 million in market value –  after energy provider AGL announced it was backing out of plans to buy it.

“We are no longer confident that an acquisition of Vocus at the proposed terms would represent sufficient certainty of creating value for AGL shareholders,” AGL Managing director and CEO Brett Redman told the ASX.

After the announcement, AGL shares lifted to finish the week at $20.39, from a low of $19.40 on Tuesday, 11 June.

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