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The ASX share market is struggling today as the S&P/ASX 200 Index (ASX: XJO) seals its first monthly decline since September 2020.

It appears Wall Street has paved the way for today’s sharp decline, with its major indices opening slightly higher before fading heavily by market close.

The S&P 500 Index (SP: .INX), Dow Jones Industrial Average Index (DJX: .DJI) and Nasdaq Composite Index (NASDAQ: .IXIC) all closed near session lows, down 1.19%, 1.59% and 0.44% respectively.

At the time of writing, the ASX 200 is down 2.11% at 7177 points. Let’s look at some of the factors that might be weighing the market down today.

Why the ASX share market is struggling to bounce

Interest rate hikes on the horizon

The US Federal Reserve signalled last week that it may begin raising the benchmark interest rate in late 2022.

Equity markets, more notably tech and richly valued growth shares have thrived under ultra-low interest rates.

With potential looming interest rate hikes on the horizon, investors have been quick to rotate away from these sectors.

In the last week, the S&P/ASX Information Technology (INDEXASX: XIJ) and S&P/ASX Health Care (INDEXASX: XHJ) have logged hefty declines, tumbling 6.41% and 6.09% respectively.

Iron ore woes continue

ASX 200 iron ore heavyweights BHP Group Ltd (ASX: BHP), Fortescue Metals Group Ltd (ASX: FMG) and Rio Tinto Limited (ASX: RIO) have weighed on the broader commodities sector as iron ore plunged from May all-time highs of US$230 a tonne to around US$120 a tonne this week.

The iron ore majors continue to bleed amidst weak economic data from China, with all three iron ore majors falling between 2.4% and 3.5% on Friday.

Lending indicators plateau

Australia’s lending indicators for new borrower-accepted finance commitments for housing doubled between March 2020 lows and June 2021.

But the once bullish lending indicators might have hit a near-term top with the latest figures from the Australian Bureau of Statistics (ABS) signalling a broad pullback in new loan commitments.

New borrower-accept loan commitments for housing declined 4.3% month-on-month while personal fixed-term loans also declined 2.5%.

This might also be a reason why the Commonwealth Bank of Australia (ASX: CBA) share price has plunged 4.29% to $98.85 at the time of writing.

The post What is weighing the ASX share market down today? appeared first on The Motley Fool Australia.

More reading

• Why has the Boss Energy (ASX:BOE) share price tanked 30% in 2 weeks?
• Why the Virgin Money UK (ASX:VUK) share price is sinking 6% today
• The Flight Centre (ASX:FLT) share price is in the green today. Here’s why
• NIB (ASX:NHF) share price struggles as despite big profits in FY21
• Why is the Li-S Energy (ASX:LIS) share price sliding 9% today?

Motley Fool contributor Kerry Sun has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Virgin Money UK CDI (ASX: VUK) share price has been a particularly poor performer on Friday.

In afternoon trade, the UK bank’s shares are down 6% to $3.79.

Why is the Virgin Money UK share price tumbling?

There appear to have been a couple of catalysts for the weakness in the Virgin Money UK share price on Friday.

One is broad market weakness, which is being felt more than most in the banking sector. For example, the Commonwealth Bank of Australia (ASX: CBA) share price is down 4% at the time of writing.

Another potential catalyst for the Virgin Money UK share price weakness could be the release of an announcement after the market close on Thursday.

What did Virgin Money UK announce?

According to the release, Virgin Money UK has decided to accelerate its digital strategy in order to enable greater efficiency and drive up levels of digitisation across the bank. This is with the aim of further developing a strong, scalable platform for future growth.

This plan is going to come at a cost, though. The release explains that restructuring charges for FY 2021 are now expected to be ~GBP145 million in total with an additional ~GBP45 million booked in the fourth quarter.

Where do the new charges come from?

Part of the strategy will see the bank close almost a fifth of its branches in the coming months. Virgin Money UK has identified 31 stores out of the 162 in its network which will be closed. This is expected to cost ~GBP25 million.

The bank will also be embracing the work from home initiative. This will result in lower office space requirements, with infrastructure and office hubs re-purposed to fit new ways of working.

After applying valuation adjustments and including other operating model changes, the bank expects to incur a ~GBP20 million restructuring charge in the fourth quarter from these changes.

However, management believes these costs will be worth it in the long run.

It explained: “The Group’s digital strategy will further develop a strong, scalable platform for future growth. In the near term, cost savings from improved productivity delivered by Virgin Money UK’s digital initiatives will be reinvested into the business to further accelerate the pace of platform development. Virgin Money UK will also leverage the capabilities of its key strategic partnerships, such as those announced with Global Payments and Capita, to deliver additional features and differentiated propositions for customers.”

The Virgin Money UK share price is up 61% in 2021 despite recent weakness.

The post Why the Virgin Money UK (ASX:VUK) share price is sinking 6% today appeared first on The Motley Fool Australia.

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• ASX quarterly rebalance: A2 Milk dumped from ASX 50, Nuix kicked out of ASX 200

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Flight Centre Travel Group Ltd (ASX: FLT) share price is currently up as international borders may reportedly open sooner than expected. That compares to the S&P/ASX 200 Index (ASX: XJO) which is currently down around 2.2%.

What’s happening with international borders?

It is being reported across the major media outlets, such as the Australian Financial Review, that Prime Minister Scott Morrison is going to announce that international travel is soon going to open up for fully vaccinated Aussies.

The reporting says that Australians will be able to leave Australia. People stuck in other countries will also be able to return easier.

However, this is only when the double vaccination rate of 80% has been reached. The international borders will lift on a state by state basis when that region reaches its own 80% level. NSW and ACT are expected to be the first two places to reach the required vaccination rate to allow international travel.

The plan is that the international border is going to be open before Christmas. Part of the plan could include arrivals going through home quarantine rather than hotel quarantine.

The Flight Centre share price is still down almost 40% from the pre-COVID level, so international travel may have its part to play in a recovery.

Not all state leaders have signed up to the international travel plan just yet.

The Guardian quoted Queensland Premier Ms Palaszczuk from her news conference, she said:

I’m not going to agree to anything when I haven’t seen any formal paperwork. It would be irresponsible and I think that Queenslanders would expect me to see some paperwork, to understand the issues before an announcement is made. So it’s a bit disappointing that we haven’t been given that due courtesy before National Cabinet.

What I’ve said clearly and Dr Young has said this and the Health Minister has said this. We need to be in a situation where every eligible person, so every eligible person in that cohort is offered a vaccine.

How is Flight Centre’s profit going?

There wasn’t a profit in FY21. It made an underlying loss of $507 million, with almost $4 billion of total transaction value (TTV).

However, it did say that the recovery is gaining momentum, particularly in the corporate sector and in the US. In its FY21 result, it said that it was seeing month-on-month sales revenue growth despite lockdown and heavy restrictions, ending with a COVID-period record in June 2021.

By the year end, corporate TTV was tracking at 40% of pre-COVID levels globally.

Flight Centre is targeting a return to monthly profitability in both corporate and leisure during FY22. The company is looking to the resumption of further global international travel, with a potential material benefit from the trans-Atlantic route opening.

Its profitability hopes rely on vaccination efficacy, governments reopening borders and keeping them open.

Is the Flight Centre share price a buy?

Citi isn’t sure that it is, with a neutral rating and a price target of $16.94. That suggests the broker thinks Flight Centre shares could fall around 20% over the next 12 months.

Whilst Citi is expecting Flight Centre to benefit from the travel recovery, it doesn’t think the old Flight Centre model will be as effective.

The post The Flight Centre (ASX:FLT) share price is in the green today. Here’s why appeared first on The Motley Fool Australia.

More reading

• Why the Webjet (ASX:WEB) share price is on the rise today
• ASX 200 (ASX:XJO) midday update: Gold miners jump, Pro Medicus wins contract
• These were the 5 best performing ASX 200 shares in September
• These were the 5 worst performing ASX 200 shares in September
• 5 things to watch on the ASX 200 on Friday

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Flight Centre Travel Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The NIB Holdings Limited (ASX: NHF) share price is sliding today and currently trades 2.87% down at $6.77 apiece.

NIB shares are struggling in early trade after the insurance giant released its FY21 annual report before the market’s open.

The company had already released its FY21 earnings in August, however, a more detailed overview of FY21 operations is contained in NIB’s annual report.

NIB share price slides despite strong profit growth in FY21

It was a strong year for NIB’s operating performance, as it recognised growth across all measures of profitability in FY21.

Its premium revenue came in at $2.2 billion for the year, up almost 5% from FY20. This was backed by investment income growth of 212%, which contributed a healthy $51.8 million to its earnings.

Underlying operating profit gained almost 40% to $205 million, which carried through to an 85% year on year gain in net profit after tax (NPAT).

Another takeout from its annual report is that NIB generated a return of 7.9% on the capital it invested throughout the year. That’s a total of $19.1 million, and in line with the figure for FY19.

That’s important to know because it’s well above the $2 million annual interest expense NIB has on its debt.

With this momentum, the board was able to declare a 14 cents per share final dividend.

This brings the full year dividend for FY21 to 24 cents per share, with NIB paying out 68% of NPAT in dividends to shareholders.

Investors will realise this dividend into their brokerage accounts on 5 October, or participate in the dividend reinvestment plan (DRIP), if eligible.

Aside from this, NIB also remains committed to sustainability, by taking a number of steps to improve its ESG framework.

For instance, it has invested over $2.7 million in community funding, including “a $1 million NIB foundation investment towards chronic disease prevention”.

It also developed a Responsible Investment Policy that aims to improve how the company screens sustainability factors in its investment portfolio.

What’s next for NIB?

NIB has committed to becoming carbon neutral by the end of FY22, by reducing its overall carbon emissions.

It also sees continuing challenges over the next year, as the COVID-19 pandemic continues to mark uncertainty for the company.

As such, the company has revised its forecasts on its travel business, due to ongoing uncertainties on border restrictions.

Its set revenue forecasts are in line with external industry forecasts and federal budget expectations. NIB assumes a gradual recovery in travel volumes, with a “full return to pre-COVID levels in FY24”.

NIB shares have climbed 14% this year to date, and have edged almost 0.5% higher this past month.

The post NIB (ASX:NHF) share price struggles as despite big profits in FY21 appeared first on The Motley Fool Australia.

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The author Zach Bristow has no positions in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has recommended NIB Holdings Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Li-S Energy Ltd (ASX: LIS) share price is tumbling again today despite no news having been released by the ASX newbie.

Li-S Energy floated on the ASX on Tuesday, gaining a massive 175% on the day of its initial public offering (IPO).

It gained another 3.85% on Wednesday before falling 14.8% yesterday.

The plunge is continuing into today’s session. At the time of writing, the Li-S Energy share price is $1.90, 8.21% lower than its previous close.

However, that’s still 123% higher than its prospectus’ offer price of 85 cents per share. That offer price saw Li-S Energy raise $34 million through its IPO.

Let’s take a closer look at the lithium-sulphur battery technology company’s first week on the ASX.

What’s up with the Li-S Energy share price?

Li-S Energy’s shares are in the red for the second day in a row despite the company’s silence.

Li-S Energy debuted on the ASX on Tuesday, delighting market watchers when its stock’s value soared to finish its first day’s trade at $2.34.

In fact, the company’s stock set its first, and so far only, record high of $3.05 in intraday trade on Tuesday.

However, the market might have since calmed down from its initial excitement. The Li-S Energy share price has tumbled on Thursday and Friday, though it’s still miles above its offer price.

Currently, Li-S Energy has a market capitalisation of around $1.2 billion. That’s impressive considering the company has anticipated it would float with a market capitalisation of around $544 million.

Oddly enough, the company from which Li-S Energy spawned – PPK Group Limited (ASX: PPK) – has been struggling on the ASX this week.

The PPK share price has been falling all week despite Li-S Energy’s successful float. PPK owns 45.4% of Li-S Energy’s stock.  

The PPK share price is currently 18% lower than it was at last Friday’s close.

The post Why is the Li-S Energy (ASX:LIS) share price sliding 9% today? appeared first on The Motley Fool Australia.

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Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The AGL Energy Limited (ASX: AGL) share price had yet another disappointing month, falling to a multi-decade low of $5.22. Investors have continued to dump the energy company’s shares leading to a 10% loss for September.

At the time of writing, AGL shares are adding more pain to shareholder portfolios, down 0.26% to $5.77 apiece.

What’s happening with AGL lately?

It’s been a relatively quiet couple of months for the company, with its last market-sensitive news being its full-year results.

However, a catalyst dragging down AGL shares might be tough conditions for the national electricity market along with unstable electricity prices.

The company previously noted that a sharp decline in wholesale prices for electricity and renewable energy certificates affected its financial performance.

AGL regards the energy market in the 2021 financial year as one of the most difficult on record.

In addition, the increased demand to decarbonise its operations has impacted Australia’s largest carbon emitter. Nonetheless, management plans to turn things around as AGL becomes a more agile business.

At its Annual General Meeting (AGM) last week, the majority of shareholders voted in favour of AGL setting emissions targets. This is in accordance with the Paris Agreement which sets out a global framework to avoid dangerous climate change.

Shareholders strongly opposed the AGL board’s recommendation to vote against adopting decarbonisation targets.

In other news, AGL plans to transform the Liddell coal-fired power station into a hydro and solar energy facility after Liddell’s shutdown in 2023.

Only time will tell if the AGL share price can recover to its pre-COVID highs of about $20.

About the AGL share price

In 2021, the AGL share price has continued to plummet in value, losing more than 50% for investors. Over the past 12 months, its shares are deeper in the red and down almost 58%.

On valuation grounds, AGL presides a market capitalisation of approximately $3.8 billion, with approximately 658 million shares on its books.

The post Why did the AGL share price have such a lousy month in September? appeared first on The Motley Fool Australia.

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• 3 ASX 200 shares down more than 50% in 2021
• Why is the AGL (ASX:AGL) share price down almost 4% on Tuesday?
• How has the AGL (ASX:AGL) share price performed since reporting FY21 results?
• Brokers name 3 ASX shares to buy today
• Why the embattled AGL (ASX:AGL) share price is surging higher today

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Motley Fool Australia Chief Investment Officer Scott Phillips joined Nine’s Late News on Thursday night to discuss the best day in 10 months on the ASX (but the first negative month in a year), plus the bounce in banking and resources, and Zip Co Ltd (ASX: Z1P) inking a deal with Microsoft Corporation (NASDAQ: MSFT).

The post The best day in 10 months, and Zip’s Microsoft deal. Scott Phillips on Nine’s Late News appeared first on The Motley Fool Australia.

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Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool’s board of directors. Motley Fool contributor Scott Phillips has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Microsoft and ZIPCOLTD FPO. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Santos Ltd (ASX: STO) share price is looking worse for wear on Friday, breaching the $7 mark. This follows reports that the oil and gas company’s largest shareholder launched a selling spree last night.

At the time of writing, shares in the $14.4 billion Australian energy company are fetching $6.87, down 4.2%. For context, the S&P/ASX 200 Index (ASX: XJO) is having a disastrous day, down 2.14%.

Let’s take a look at the latest Santos news.

Hefty selldown

The broader base of Santos shareholders appears to be following the lead of its largest investor on Friday. According to reports published by The Australian, private Chinese energy and investment company ENN Group initiated a substantial sale of shares last night.

Prior to this event, ENN held a 10% stake in Santos through its ‘United Faith Ventures’ investment vehicle, making it the company’s largest shareholder.

It is believed that investment bankers Morgan Stanley and UBS were called in to sell 60 million shares in a block trade on behalf of ENN. Although Santos closed at a price of $7.17, the deal was conducted between $6.70 and $6.75 per share. Additionally, bids were accepted in 1 cent increments.

All in all, the sale amounted to a total value of $403 million. Despite this large sale, ENN would still hold approximately 147.6 million shares based on documentation.

Interestingly, this is not the first time ENN has reduced its interest in Santos. Back in March, the shareholder waved goodbye to a third of its holding — with Santos shares commanding a $7.33 price at that time. This monumental selldown was worth around $785 million, with Morgan Stanley and UBS carrying out that transaction as well.

Analysts target on Santos share price

The large sale comes amid a bullish trend in the energy sector. As Europe and China grapple with turbulence in energy supply, prices for energy-bearing resources such as oil and gas are rising with authority.

As such, one analyst recently shared an optimistic perspective on the Santos share price, setting a price target of $8.55. This would indicate a potential 24% upside in the company’s value in the next 12 months (excluding dividends).

The post Santos (ASX:STO) share price sinks after investor sells $403m stake appeared first on The Motley Fool Australia.

More reading

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Motley Fool contributor Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The S&P/ASX 200 Index (ASX: XJO) is on course to end the week on a very disappointing note. In afternoon trade, the benchmark index is down 2.35% to 7,159 points.

Four ASX shares that are defying the market selloff are listed below. Here’s why these ASX shares are rising:

Evolution Mining Ltd (ASX: EVN)

The Evolution Mining share price is up 2.5% to $3.57. As well as getting a boost from a rising gold price, a positive announcement has given this gold miner’s shares a lift. That announcement reveals that its Cowal Gold Operation has been granted regulatory approval to develop an underground mine. The development will extend the operation’s permitted mine life to 2040. It is also expected to support production in excess of 350,000 ounces of gold per annum from Cowal.

Northern Star Resources Ltd (ASX: NST)

The Northern Star share price is up 3.5% to $8.80. This appears to have been driven by a decent rise in the gold price overnight and increased demand for safe haven assets. According to CNBC, the spot gold price rose 2% on Thursday night to US$1,758.10 an ounce.

Weebit Nano Ltd (ASX: WBT)

The Weebit Nano share price has jumped 7% to $2.74. This follows the release of an update this morning. According to the release, together with its development partner CEA-Leti, Weebit Nano has demonstrated production-level parameters of its Resistive Random-Access Memory (ReRAM) technology in a 28 nanometre (nm) process.

Whitehaven Coal Ltd (ASX: WHC)

The Whitehaven Coal share price is up 3% to $3.32. Investors have been buying this coal miner’s shares after coal prices continued their ascent. According to CommSec, the spot thermal coal price rose 3.6% overnight to US$218 a tonne. Very strong seasonal demand in China is driving prices notably higher this week.

The post Why Evolution, Northern Star, Weebit Nano, & Whitehaven Coal are rising appeared first on The Motley Fool Australia.

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• Here’s why the Weebit Nano (ASX:WBT) share price is jumping 14% today
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The Webjet Limited (ASX: WEB) share price is currently up 0.8%, whilst the S&P/ASX 200 Index (ASX: XJO) is down by 1.7%. It is being reported that international travel is going to open sooner than originally expected.

What’s happening with international travel?

According to reporting by various news media, such as the Australian Financial Review, the Prime Minister Scott Morrison will announce that international borders are going to open earlier than expected. Perhaps as soon as next month.

It isn’t going to be a return to limitless international borders straight away, according to the reporting.

Vaccinated Australians will be able to leave the country. Aussies stuck overseas will also be able to return. But this is only when the double vaccinated rate of 80% has been reached.

The borders will be lifted on a state by state basis, once that state or territory reaches the required 80% rate. That means that places like the ACT and NSW are closer to potentially seeing international travel than other states.

The goal is that the international borders are going to open up before Christmas.

Over the last two years, the Webjet share price has seen a lot of volatility as COVID-19 impacts when and where travellers can go.

However, not every state leader is on board with the plan yet. According to the ABC, the Queensland Premier Ms Palaszczuk said:

It would be irresponsible and I think that Queenslanders would expect me to see some paperwork, to understand the issues before an announcement is made. So it’s a bit disappointing that we haven’t been given that due courtesy before National Cabinet. We need to be in a situation where every eligible person, so every eligible person in that cohort is offered a vaccine.

What does this mean for the Webjet share price and profit?

COVID-19 has caused a lot damage to Webjet’s profit. In FY21 it saw a net loss after tax of $156.6 million, which was even worse than the $143.6 million loss in FY20. FY21’s underlying loss was $88.8 million, which excludes some non-operating expenses.

Webjet says that there is strong pent-up demand for travel, particularly leisure travel and all its businesses are well positioned to capture it. The company has been focused on transforming all of its businesses to be ready to capitalise when global travel returns.

Management say that all businesses are highly leveraged to domestic and international leisure markets. Webjet also says that the structural shift from offline to online continues to accelerate with all businesses positioned to capture demand.

The company is aiming to become the number one global business to business provider. It says it’s on track to reduce costs by at least 20% once the company gets back to scale.

It has seen “strong demand” as travel restrictions ease in North America and Europe, suggesting “significant upside” as more international markets reopen.

Is the Webjet share price worth looking at?

Webjet is currently rated as a buy by the broker UBS, with a price target of $6.85. The broker notes that Australia’s vaccinated rate is rising, which is helping the prospects for the ASX travel share sector.

The post Why the Webjet (ASX:WEB) share price is on the rise today appeared first on The Motley Fool Australia.

More reading

• ASX 200 (ASX:XJO) midday update: Gold miners jump, Pro Medicus wins contract
• 2 ASX shares that could be buys in October 2021
• These were the 5 best performing ASX 200 shares in September
• These were the 5 worst performing ASX 200 shares in September
• 5 things to watch on the ASX 200 on Friday

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Webjet Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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