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Following closely behind was Mineral Resources, which dived 13.8 per cent after the company launched an external probe into an alleged tax evasion scheme involving its billionaire founder Chris Ellison. Youth jewellery chain Lovisa closed 6.4 per cent lower.
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The lowdown
Not everyone thinks the double-digit losses in Mineral Resources are justified. “While we understand that these concerns raise questions over corporate governance, we think the share price move today is overdone,” wrote RBC Capital Markets analyst Kaan Peker in a note to clients.
“The added scrutiny and rigour, the current concerns placed on corporate governance, ultimately, should be positive for the organisation, and at face-value there appears to be no adverse impact to operations/management.”
Elsewhere in the market, Qantas wound up 1.4 per cent higher despite facing a hefty compensation payout to 1700 illegally sacked workers. The airline will pay compensation for three test cases amounting to $170,000. The Transport Workers Union, which first brought the case in 2020, will now go into mediation with Qantas to finalise the payout for the remaining workers based on the amounts assigned to the three test cases.
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Meanwhile, furniture seller Nick Scali slipped 4.1 per cent after announcing in a trading update that profits and margins would be affected by high freight rates. Half-year net profit for its Australia and New Zealand businesses is expected to sit between $30 million and $33 million, down from $43 million a year ago. Chairman John Ingram announced his retirement at the company’s annual general meeting today.
RBC Capital Markets’ chief economist Su-Lin Ong said the global central bank easing cycle was in “full swing”. Other central banks were stepping up their pace of easing as confidence grew about reaching inflation targets.
“Against the backdrop of global easing, investors continue to ask whether Australia is different or just lagging the global macro cycle,” Ong said in a note. “We err towards the former and highlight the labour market as one of three factors underpinning Australian economic outperformance.”
Late last week, the S&P 500 rose 0.4 per cent to squeak past the all-time high it had set early in the week. The Dow Jones added 36 points, or 0.1 per cent, to beat its own record set the day before, and the Nasdaq Composite gained 0.6 per cent.
Trading overall on Wall Street remained relatively calm, as the S&P 500 closed its sixth straight winning week for its longest such winning streak of 2024.