The S&P/ASX 200 Index (ASX: XJO) dropped 0.4% today after investors realised there was a potential threat to Australian iron ore miners from China.
Potential problems for the Australian iron ore sector
The worry is that China could cause major disruptions to Australia’s iron ore exports. It could mean Australian iron ore gets checked but Brazilian imports don’t have the same checks. That could be bad for ASX 200 miners like BHP Group Ltd (ASX: BHP), Rio Tinto Limited (ASX: RIO) and Fortescue Metals Group Limited (ASX: FMG).
But BHP isn’t worried about it and actually thinks it could lead to a quicker process. Fortescue also confirmed it was part of a process that has been in the works for years.
Plenty of people are linking Australia’s support for a coronavirus inquiry to a potential backlash by China. We have already seen the Asian superpower put tariffs onto Australian barley.
Service Stream Limited (ASX: SSM) share price drops 6%
The company warned there are negative impacts. Those impacts largely relate to delivering safe field-based operations. Also, some clients are temporarily pausing some work programs and some individual minor projects have been delayed.
The company is now expecting earnings before interest, tax, depreciation and amortisation (EBITDA) from operations to be $108 million. It would still be a record operating result for the company.
Service Stream said its balance sheet, cashflow and liquidity remains “very strong”. Management still expect the company to pay a dividend, unlike some other ASX 200 shares.
Afterpay Ltd (ASX: APT) keeps growing in the US
Afterpay said that Afterpay US has now reached 5 million active customers.
In reaction to this news the Afterpay share price rose by 2.6% to finish the day at $44. But at one point the Afterpay share price went up to $45. Today saw a new all-time high for the ASX 200 share.
However, investors also learned that global ecommerce giant Shopify is planning to launch a buy now, pay later service for customers.
Aristocrat Leisure Limited (ASX: ALL) releases its result
The ASX 200 gambling business announced its half-year result today.
Operating revenue rose by 7% to $2.25 billion and normalised net profit fell 14.2% to $305.9 million. However, reported net profit rose 277.2% to $1.3 billion which included the recognition of a $1 billion deferred tax asset.
But no interim dividend was declared so that liquidity remains as strong as possible.
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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 AFTERPAY T FPO. The Motley Fool Australia has recommended Service Stream 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.