The S&P/ASX 200 (ASX: XJO) finished around 0.6% lower as a swathe of dividend payments were extracted from the market. On a second level it was broadly mixed with materials and mining falling 2.5%, whilst staples and healthcare were both down similarly, around 1% each.
BHP, Woolies & AGL dividends drag the ASX lower
The impact of dividend payments and ex-dividend dates remains widely misunderstood by many investors, with Thursday the perfect example.
Shares in BHP Group Ltd (ASX: BHP) fell by 6.9%, which equated to $3.09 cents per share, which naturally attracted headlines. Yet the company was trading ex-dividend for a payment of $2.74 cents per share, which shareholders will receive in a few months’ time, meaning the actual fall was just 35 cents per share or 0.7%.
It was the same story for Woolworths Group Ltd (ASX: WOW), down 63 cents with a dividend of 55 cents, and AGL Energy Limited (ASX: AGL) falling 3%, which was less than the dividend payment.
The same story goes for managed and exchange traded funds (ETFs) which all distribute in June.
Meanwhile, there are rumours this week that GQG Partners, a $100 billion fund manager and one of the leading investors in the world, may be listing their company via IPO on the ASX before the year is out.
Flight Centre turns to Japan
Flight Centre Travel Group Ltd (ASX: FLT) was a rare winner, up 0.5%, after announcing an agreement with NSF Engagement Corp, a Japanese real estate agent who will support their entry into the domestic corporate travel market.
Management noted that there are green shoots in travel in both Europe and the US, but little positive news in Australia.
Record trade balance on commodities
Australia saw a record trade balance in July, hitting $12.1 billion with iron ore, coal and LNG powering the exports leaving our shores. Behind the strength were two key themes, the first being the weakness in imports as borders remain closed and secondly, the boom in iron ore and coal prices in recent months.
This is set to come to an end though with the iron ore price down over 30% in just a few weeks, which is likely to put growing pressure on the economy. Exacerbating this price fall was the Chinese Government’s well flagged decision to curb steel output as is typically the case around this time of the year.
Refinancing boom
Mortgage refinancing reached an all-time high in June, with $17.2 billion of loans refinanced, 60% month-on-month growth.
Consumers are clearly seeking to lock in lower interest rates or alternatively, release additional funds to support their lifestyle and business operations.
ASX 200 today
The ASX 200 is set to follow a positive lead from US markets and open higher on Friday. To find out more, check out Rask Media’s daily US stock market report.