An office worker talks on his phone as he looks the stock board at the Australian Securities Exchange (ASX) building in central Sydney June 15, 2012.
An office worker talks on his phone as he looks the stock board at the Australian Securities Exchange (ASX) building in central Sydney June 15, 2012. Reuters/Daniel Munoz
  • Local shares recovered over the course of Monday afternoon to finish marginally higher having seen a 28 point loss in early trade. Investors remain wary ahead of the US Federal Reserve meeting which could deliver greater clarity on the timing of a US rate hike. Commsec’s base case scenario remains for the Fed to begin lifting rates in December which should continue to support the US dollar. Most ASX sectors ended higher, a contrast to the early part of the session which saw most in the red. Financials were the mainstay for the market, although the turnaround for the Materials and Energy sectors allowed the market to consolidate in positive territory. Value was modest on Monday at $3.8 billion, following 1.8 million trades. 469 shares ended higher, while 488 were lower and 358 closed unchanged.
  • Navitas (NVT) shares fell after the education provider highlighted flat earnings in the year ahead due to the loss of key contracts with major institutions. It comes after NVT reported that net profit rose 42% to $71 million in the year ended June 30, up from $51.6 million a year earlier. The result included an impairment of $19.5 million as it wrote down the value of some discontinued programs in the prior year. Underlying earnings before interest tax and depreciation rose 13% to $163 million. Navitas maintained its full year dividend at 19.5 cents a share. NVT shares ended 6% lower at $4.27
  • iiNet (IIN) shareholders have approved the proposed $1.6 billion takeover of the company by TPG Telecom (TPM) at a meeting in Perth today. The merger of IIN and TPM will create Australia's second biggest fixed-line internet provider behind Telstra. TPM is offering cash, or a combination of cash and shares for each IIN share. IIN shareholders who choose the cash option will receive $9.55 per share comprising $8.80 in cash plus a special dividend of up to 75 cents for each iiNet share. Shareholders who choose the cash-and-scrip option will receive 0.5533 new TPM shares, $3.77 in cash, and the special dividend. If the special dividend is less than 75 cents, iiNet shareholders will receive a top-up cash payment for the difference between the special dividend and up to 75 cents. The takeover still requires approval from the Australian Competition and Consumer Commission (ACCC) and the Federal Court. TPM shares closed the session at $9.22 a gain of 8 cents or 0.8%, IIN settled at $9.40 a gain of 3 cents or 0.3%.
  • Shares in Atlas Iron (AGO) closed down 70 percent at 3.6 cents after resuming trading for the first time in more than three months. AGO shares traded at 12 cents per share prior to their suspension. The company suspended its shares in April after a fall in iron ore prices forced it to close three mines, which have now been restarted following a capital raising which netted $87 million, well below company expectations of $180 million.
  • The AUD/USD recovered somewhat in Asian trading on USD weakness and a lift in iron ore futures which saw prices rise the most part of 3%. Nevertheless the local unit is likely to remain heavy this week because of support for the Greenback in the face of weak commodity prices.

Tom Piotrowski - Market Analyst (Author)

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