The ASX ran out of steam following a choppy start, but Crown Resorts surged after the Victorian royal commission gave its flagship Melbourne casino a stay of execution.
The Australian sharemarket went on a wild rollercoaster ride in volatile morning trade, then slumped in the afternoon, finishing barely changed, but Crown Resorts rocketed after the Victorian royal commission gave its flagship Melbourne casino a stay of execution.
The benchmark S&P/ASX200 index lifted just 2.4 points to 7443.4, while the All Ordinaries Index added 5 points to 7759.3.
CommSec analyst Steven Daghlian said the tentative move higher came after Wall Street hit a record high overnight, buoyed by strong quarterly earnings results.
“It continues to be quite clear that the moves higher in the past couple of weeks have been quite modest: the average improvement over the past fortnight has been just a quarter of 1 per cent,” Mr Daghlian said.
Standouts included buy-now-pay-later market leader Afterpay, up 3.3 per cent at $126.64.
Crown leapt as high as $10.90, before finishing up 8.7 per cent at $10.50 after Commissioner Raymond Finkelstein “somewhat reluctantly” recommended against stripping Crown Melbourne of its gaming licence despite “disgraceful … variously illegal, dishonest, unethical and exploitative” conduct.
While facilitating money laundering at the venue dominated the probe, there was an alarming “catalogue of wrongdoing”.
“Perhaps the board was not told what was going on. The alternative … is that the board ‘fell asleep at the wheel’,” Commissioner Finkelstein said.
Crown has been put on a two-year “probation”, with a new “special manager” overseeing and controlling its affairs, then reporting back to the regulator, who will decide whether it is satisfied the company is suitable to keep its licence.
Macquarie Research said the good news should provide a precedent for Crown’s other casino licences.
“We would argue that the market was largely pricing in a favourable outcome for the Crown Melbourne casino licence,” its analysts said, giving Crown a $10.40 target price on an ongoing basis, assuming all licences were retained.
Goldman Sachs gave Crown a 12-month target price of $10.29, saying the outcome was a positive for the sector more broadly from a regulatory risk perspective.
Indeed, Crown’s rival and spurned suitor, Star Entertainment Group, which is in the midst of its own money laundering scandal, piggybacked higher.
Star shares jumped 4.34 per cent to $3.61.
“It’ll still be some time before shareholders can think about recouping invested funds, as Crown and The Star lost about 50 per cent and 30 per cent respectively when inquiries were announced,” OMG chief executive Ivan Tchourilov said.
New Zealand-based casino operator SkyCity Entertainment Group firmed 1.33 per cent to $3.05.
In the energy sector, Oil Search reported a 12 per cent rise in third quarter revenue and a 5 per cent production lift, but its shares slipped 1.34 per cent to $4.42.
Ampol released its unaudited third quarter financial results, showing its convenience retail and fuel sales were hit by the NSW and Victorian lockdowns. Its shares were steady at $31.26.
Gold miner Regis Resources slumped 6.14 per cent to $2.14 after reporting a “soft” quarter, but maintained its full year production guidance.
Another gold miner, Kingsgate Consolidated, leapt 21.47 per cent to $1.98 for no obvious reason.
Rio Tinto slid 0.57 per cent to $95.89, BHP put on 0.74 per cent to $38.21, Fortescue eased 0.97 per cent to $14.37 and Mineral Resources retreated 7.04 per cent to $39.89 after delivering its September quarter report showing a slump in mined iron ore and spodumene shipments from its West Australian operations.
MinRes was the best performer on the S&P/ASX200 on Monday after announcing it would restart operations at its Wodgina lithium mine in WA, which was mothballed in 2019 because of then-weak global market conditions.
Pilbara Minerals surged 8.13 per cent to $2.26 after announcing it had finalised a joint venture deal with steel giant POSCO to develop and operate a lithium hydroxide monohydrate conversion facility in South Korea.
Piedmont Lithium galloped 10.63 per cent higher to 88.5 cents.
Bega Cheese held its annual general meeting, telling investors there had been “a structural change in the Chinese infant formula market, which will not recover to pre-Covid-19 levels”.
“The change has impacted our infant and toddler dairy nutritional business, which we are managing through the continued development of other markets and ‘right sizing’ our manufacturing infrastructure,” executive chairman Barry Irvin said.
Bega Cheese shares inched 0.19 per cent higher to $5.34.
Nanosonics was a strong performer, rallying 9.35 per cent to $6.08 – but well down from its 12-month closing high of $8.25 – with Morgans slapping a $6.97 price target on the infection control company, while Bell Potter has it at $6.35.
ANZ lifted 0.32 per cent to $28.41, Commonwealth Bank eased 0.34 per cent to $105.10, National Australia Bank put on 0.56 per cent to $28.90 and Westpac appreciated 0.3 per cent to $25.79.
The Aussie dollar was fetching 75.13 US cents, 54.57 British pence and 64.74 Euro cents in afternoon trade.
Originally published as Australian sharemarket closes barely changed again as investors remain ‘tentative’
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