The S&P/ASX 200 (Index: ^AXJO) (ASX: XJO) was eventful this week. Here are four big stories that affected the index:
Royal Commission is hurting the banks
Two of the major banks released their FY18 results today. Both National Australia Bank Ltd (ASX: NAB) and Australia and New Zealand Banking Group (ASX: ANZ) reported double-digit declines in their cash earnings due to refunds & remediation (and restructuring) relating to the Royal Commission. Ouch.
Australia’s largest bank, Commonwealth Bank of Australia (ASX: CBA), also revealed the sale of its global asset management division in a bid to rid itself of the vertical integration model it had created.
Property prices keep falling
The flow-on from the Royal Commission has been a tightening of credit from the banks, leading to falling property prices. If people can’t borrow as much they can’t bid as much for property.
Nationally, house prices fell by 0.5% in October. In Melbourne and Sydney house prices fell by 0.7%. A negative wealth effect could hamper various points of the economy and share market.
Corporate Travel Management Ltd (ASX: CTD) faces the music
The travel business came out of its trading halt after responding to the various negative points raised by a short seller. Despite largely answering the points, investors have headed for the exits.
Since coming out of a trading halt Corporate Travel Management shares are down over 27% despite a recovery on Thursday.
BHP Billiton Limited (ASX: BHP) is rewarding shareholders
Resource shares have a reputation for being cyclical. When they’re down it’s bad, but when times are good investors can roll in the money.
BHP management unveiled a shareholder return bonanza this week with a US$10.4 billion buy back and special dividend program.
A very nice early Christmas present for BHP shareholders.
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Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Corporate Travel Management Limited. The Motley Fool Australia owns shares of National Australia Bank Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.