At lunch on Tuesday the S&P/ASX 200 Index (ASX: XJO) has given back the majority of its morning gains but is still trading higher. The benchmark index is currently up 0.15% to 5,961.2 points.
Here’s what is happening on the market today:
A2 Milk sinks again.
The A2 Milk Company Ltd (ASX: A2M) share price has continued its slide on Tuesday. This decline has been driven by the infant formula and fresh milk company’s disappointing guidance update on Monday. The company warned that its first half sales would be down in FY 2021 due largely to weakness in the daigou channel. I suspect the fact that management sold millions of dollars worth of shares last month could also be impacting investor sentiment.
Bank of Queensland provisions.
The Bank of Queensland Limited (ASX: BOQ) share price has come under pressure on Tuesday after increasing its COVID-19 provisions. The regional bank’s COVID‐19 related collective provision expense is now expected to be $133 million (pre‐tax) in FY 2020. This is up from an estimate of $71 million previously. In addition to this, a further $11 million (pre‐tax) expense will be recognised for staff underpayments.
Corporate Travel Management’s acquisition.
This morning Corporate Travel Management Ltd (ASX: CTD) revealed that it is raising $375 million via a fully underwritten accelerated non-renounceable entitlement offer. These funds will be used to acquire Travel & Transport for $274.5 million. Travel & Transport is a leading US travel management company which is expected to be highly accretive to earnings. Post-synergies, management is forecasting that it will be approximately 30% earnings per share accretive.
Best and worst performers.
The Janus Henderson Group PLC (ASX: JHG) share price is the best performer on the ASX 200 today with a 4% gain. This is despite there being no news out of the fund manager. The worst performer has been the a2 Milk share price for a second day in a row. Its shares are down over 4% at the time of writing.