Afternoon (PM) Market Report

Details

Published on Friday, 02 September 2016 07:00

The ASX index dipped below the key 5,400 level at open, and traded well below the red line throughout the day to finish lower for the third consecutive session.

Friday, 2nd September 2016

Most sectors suffered losses, with only energy and materials posting gains. The Australian dollar depreciated against the greenback and had mixed results against other major currencies.

The All Ordinaries fell 40.60 points (-0.74%) to 5,470.60 while the S&P/ASX 200 lost 42.80 points (-0.79%) to 5,372.80.

Amcor announced an agreement to acquire the North American rigid plastics blow molding operations of Sonoco Products Company, a global packaging company based in the US. The acquisition price of US$280m represents a multiple of 8.0 times LTM EBITDA. The business has six production sites in the US and one in Canada, and generates annual sales of US$210m. These facilities service attractive sub-segments in the personal care and specialty food markets and the business brings strong, long standing relationships with multinational and large domestic customers. Over many years the Company Rigid Plastics has built a position in the specialty container segment through its Diversified Products business, by developing capabilities in house and acquiring specialised technologies. AMC dropped 15 cents (-0.94%) to $15.84. Alumina noted that Alcoa Inc and the Company announced that they have agreed to make certain changes to the Alcoa World Alumina and Chemicals (AWAC) JV that will enhance value for Alcoa, the Company, and their respective shareholders. In conjunction with these amendments, the parties have agreed to terminate their litigation in the Delaware Court of Chancery relating to Alcoa's pending separation into two independent, publicly traded companies. Alcoa Inc. remains on track to complete its separation in the second half of 2016. In general, the changes to the JV agreements are intended to align more closely the partners' interests in AWAC, while establishing greater strategic flexibility and autonomy for both partners. AWC added 8 cents (5.77%) to $1.38.

The NZX lifted 2.92 points (0.04%) to 7,426.11 while the Nikkei lost 1.16 points (-0.01%) to close at 16,925.68.

The Australian dollar was last quoted at 75.41 US cents.