AU Morning Wrap: ASX Flat; Sims Drops 12% on Scrap Metal Outlook

Moomoo News AU wrote a column · Sep 10, 2023 19:36

G'day, mooers! Check out the latest news on today's stock market!
• Tech drags down US stock market for week
• ASX flat, Sims plunges 12%
• Stocks to watch: Tietto Minerals, Sims, Westar Resources
- Moomoo News AU

AU Morning Wrap: ASX Flat; Sims Drops 12% on Scrap Metal Outlook

Wall Street Summary

Both tech stocks have a major influence on the broad U.S. stock index. At the end of August, Apple and Nvidia were responsible for almost 30% of the S&P 500’s 2023 total return, including dividends, according to Howard Silverblatt, senior index analyst at S&P Dow Jones Indices.

The $S&P/ASX 200(.XJO.AU)$ 500 fell 1.3% for the week while the tech-heavy $Nasdaq Composite Index(.IXIC.US)$ declined 1.9%. The $Dow Jones Industrial Average(.DJI.US)$, which includes Apple but not Nvidia, slipped 0.7%.

AU Market Watch

The Australian sharemarket has sunk at the open, dragged down by falls in tech stocks.

The $S&P/ASX 200(.XJO.AU)$ is 17.4 points, or 0.2 per cent, lower to 7139.3. The All Ordinaries is also down 0.2 per cent.

Tech sector large-caps, $WiseTech Global Ltd(WTC.AU)$ and $Xero Ltd(XRO.AU)$ are both down more than 1 per cent in early trade.

Scrap metal recycler Sims is among the worst performing, down 12.5 per cent. The company is now forecasting earnings to break even in the first quarter of FY24, due to ongoing scrap price and demand issues.

Shares Atturra are up 1.7 per cent on news the IT services outfit is set to acquire fellow ASX-lister and managed services provider Cirrus Networks. The deal values Cirrus shares at 5.3¢ apiece, around a 30 per cent premium to their close on Friday. Shareholders can take the offer on a cash-only, mixed or scrip-only form. Shares in Cirrus are up 31.7 per cent.

West African gold producer Tietto Minerals has dropped 4.1 per cent after retracting two announcements from last week related to the company’s production outlook.

$Bendigo and Adelaide Bank Ltd(BEN.AU)$ is up 1.1 per cent. The bank has appointed current board member and former $Suncorp Group Ltd(SUN.AU)$ CEO David Foster as its next chairman.

Small-cap $Westar Resources Ltd(WSR.AU)$ is up 8 per cent. The company has tapped former Northern Star chief explorer Jason Boladeras as the WA-focused gold miner’s new exploration manager.

Stocks to Watch

$Atturra Ltd(ATA.AU)$: IT services outfit Atturra is set to acquire fellow ASX-lister and managed services provider Cirrus Networks.

The deal values Cirrus shares at 5.3¢ apiece, around a 30 per cent premium to their close on Friday. Shareholders can take the offer on a cash-only, mixed or scrip-only form.

The deal is valued at up to $49.3 million and expected to close in December this year.

$Sims Ltd(SGM.AU)$: Scrap metal recycler Sims says ongoing price and demand issues are continuing to hurt its bottom line this quarter.

As a result, the company is now forecasting earnings to break even in the first quarter of FY24.

In a market update, the company said that steel demand remained subdued, and that the scrap price did not appear to be sufficient to stimulate robust scrap supply.

$Tietto Minerals Ltd(TIE.AU)$: West African gold producer Tietto Minerals has retracted two announcements from last week related to the company’s production outlook.

The miner, which began production from its West African mine earlier this year, said the two announcements contained information related to an updated seven-year production schedule and an updated 2023 resource model that has not been released to market.

The company says the full life of the mine and updated reserves statements will be available for release at the end of September 2023.