Welcome to Monday. Here are the five things I'm looking at today on the Australian sharemarket.
- The S&P/ ASX 200 (Index: ^AXJO) (ASX: XJO) has opened lower, down 0.4%.On Wall Street overnight, the Dow Jones crashed 1.8%%, while the broader S&P 500 fell 1.6% and the tech-heavy NASDAQ lost 1.2%.
Oil stocks were again taken out and pummelled, with the Canadian and UK stock markets hammered in the worst week since 2011. Resources and energy stocks were the hardest hit, and our ASX-listed equivalents look like having a rather unpleasant day ahead.
Where's the Santa Rally?
- Recall Holdings Ltd (ASX: REC), the document management business spun out of Brambles Limited (ASX: BXB), has rejected a $2.2 billion, $7.00 per share offer from US-listed Iron Mountain Incorporated, another document management business.Recall suggests the offer price is too low, just 9.4% above Recall's closing price on Friday, doesn't take into account around US$250 million in synergies from the transaction, and materially undervalues Recall.
Will Iron Mountain come back for a second bite and up its offer? That's the question on many shareholders' lips.
- Treasurer Joe Hockey is expected to unveil some alarming details about Australia's budget this afternoon during the Mid-Year Economic and Fiscal Outlook (MYEFO).Previously, the government had baked in an iron ore price of above US$90 per tonne. It's currently trading under US$70, and showing no sign of heading upwards anytime soon. Crashing oil prices are also expected to have a negative impact.
That could see the government forced to cut government spending and consider raising taxes. That could trigger a chain of events, impacting on the Aussie dollar – driving it lower, which in turn could see international investors pull their money out of the large cap stocks on the ASX. The Big Four banks are in the firing line.
- Tweet of the Day
It's hard to go in almost any direction in Tasmania and not see something beautiful. pic.twitter.com/LxfyyjUT4s
Joe Magyer (@Magyer) December 14, 2014Our own Joe Magyer discovers Tasmania.
- Stock of the Day – brought to you by Tim McArthur – Crown Resorts Ltd (ASX: CWN). The casino giant's shares are down 13% in the past three months – is this the time to take a punt? You can find out more here.
