The S&P/ASX 200 Index (ASX: XJO) charged to fresh all-time highs last week in what shaped up to be the ASX's biggest week of the year so far.
Investors' attention was immediately gripped by Monday's news that the famous buy now, pay later (BNPL) pioneer Afterpay Ltd (ASX: APT) has received a takeover offer from the US payments giant Square Inc (NASDAQ: SQ) in an all-scrip deal. The Afterpay share price immediately exploded, of course, rising roughly 30% on Monday, and finishing the week up more than 36%.
The deal, if it goes ahead, would be the largest the ASX has ever seen, eclipsing other famous mergers like the buyout of the old Westfield Corporation by Unibail-Rodamco-Westfield CDI (ASX: URW) in 2018, or the legendary purchase of Coles Group Ltd (ASX: COL) by Wesfarmers Ltd (ASX: WES) back in 2007. The all-scrip offer of 0.375 shares of Square for every Afterpay share owned that is currently under Afterpay investors' noses would equate to a deal worth almost $40 billion.
You can read all about Square, and the potential merger of these two payments giants here as part of the Motley Fool's extensive coverage of this blockbuster 'deal of the century'. But let's check out how this news set the tone for the week.
So the ASX 200 was spurred to even greater heights after this news became public last Monday morning. The ASX 200 finished the week around 2% higher by Friday afternoon, actually closing at both a new intra-day and closing record high of 7,538.4 points on Friday afternoon. In addition to Afterpay's obvious contribution to these gains, we also saw most ASX sectors rise healthily over the week.
The ASX banks led the charge, with all four majors rising steadily. Commonwealth Bank of Australia (ASX: CBA) was the standout performer, putting on a very robust 3.8% to finish the week at $103.75 per share. The other major ASX banks didn't do quite as well as that, but all rose between 2% and 3% regardless. Despite the Afterpay deal not having much at all to do with its BNPL rival Zip Co Ltd (ASX: Z1P), we also saw Zip shares managing to rocket more than 16% over the week.
We also saw strong performances from other ASX blue chips too. Woolworths Group Ltd (ASX: WOW) put up a healthy 3.33% rise to cross $40 per share for the first time since its Endeavour Group Ltd (ASX: EDV) spin off. Speaking of Endeavour, it was another strong performer, putting on 4.2% last week. Likewise, Coles and Wesfarmers also worked hard for their lodgings, both rising around 3% as well (Wesfarmers actually eeked out a 4.6% gain).
But the sector that has been so instrumental for the ASX 200's recent highs – ASX resources shares – was the one dim spot on the share market last week. The big miners like BHP Group Ltd (ASX: BHP), Rio Tinto Limited (ASX: RIO) and Fortescue Metals Group Limited (ASX: FMG) all retreated between 1% and 2%.
How did the markets end the week?
As we've already established, the ASX 200 had a week to remember last week. Monday kicked things off on the right foot with a monster 1.3% gain. This was followed by a slight retreat of 0.4% on Tuesday, but Wednesday picked up where Monday left off with another 0.4% gain. Thursday built on that with a further 0.1% rise, which was supplemented by Friday's 0.36% gain.
Overall, the ASX 200 started off the week at 7,392.6 points and finished up at 7,538.4 points – a rise of 1.97%.
Meanwhile, the All Ordinaries Index (ASX: XAO) also stepped on the gas. The All Ords started the week at 7,664.2 points and ended up at 7,806.5 points – a rise of 1.9% for the week. It's also a new record high for the All Ords, which has never seen the other side of 7,800 points before.
Which ASX 200 shares were the biggest winners and losers?
Time now for the Foolish gossip pages, our most salacious segment, where we check out the ASX 200's biggest winners and poorest losers of the week. So get the coffee brewing as we, as always, start with the losers:
| Worst ASX 200 losers | % loss for the week |
|---|---|
| Champion Iron Ltd (ASX: CIA) | (12.2%) |
| PointsBet Holdings Ltd (ASX: PBH) | (8.8%) |
| Perseus Mining Ltd (ASX: PRU) | (6%) |
| Domain Holdings Australia Ltd (ASX: DHG) | (4.9%) |
Well, the ASX 200 wooden spooner last week was a share that actually made the best winners last week – Champion Iron. Falling iron ore prices and nervousness about the Chinese economy drove all iron miners down last week. But Champion seemed to cop the worst of it, perhaps due to its recent share price performance.
Gaming company PointsBet was also in the wars last week. This company seemed to be shunned by the markets after announcing it has completed its share placement/entitlement offer for institutional investors. This raised $81 million at $8 per share, which the company intends to use for expansion into the North American markets.
Another miner in Perseus was also sold off last week. Unlike Champion Iron, Perseus is an ASX gold miner. However, gold prices also fell sharply last week, dipping back below US$1,770 an ounce after climbing as high as US$1,820 the previous week. This pulled Perseus and most other ASX gold miners lower during the week.
Finally, we had real estate advertiser Domain. Domain's weakness seemed to stem from its rival REA Group Limited (ASX: REA) releasing its trading update for the month of July on Friday. This showed some potential major impacts from the rolling lockdowns that seem to be enveloping most of the country right now. Investors were, perhaps understandably, pessimistic on Domain shares as a result.
Now with the losers out of the way, let's check out last week's winners:
| Best ASX 200 gainers | % gain for the week |
|---|---|
| Afterpay Ltd (ASX: APT) | 36.7% |
| Pilbara Minerals Ltd (ASX: PLS) | 18.1% |
| Zip Co Ltd (ASX: Z1P) | 16% |
| News Corporation (ASX: NWS) | 11.3% |
As you may have gathered by now, Afterpay was by far and away the ASX 200's best performer last week, with its monster ~37% expansion of its market capitalisation.
Lithium miner Pilbara Minerals came next, with its still-impressive 18% gain. There wasn't much news out of Pilbara last week, save from some bullish broker notes and news that US President Joe Biden hopes to see electric vehicles making at least half of all new American vehicles sold by 2023. Still, this company has been on fire in 2021 so far, now up an eye-watering 140% year to date.
Zip also saw a massive surge in attention, likely as a result of the Afterpay deal.
And lastly, we had News Corporation. The Murdoch-owned media giant delivered its full-year earnings results on Friday, which saw both revenues and profits surge. Investors responded as you might expect.
A wrap of the ASX 200 blue-chip shares
Before we… wrap things up, here is a look at how the ASX 200's blue-chip shares are faring as we start on another week in paradise:
| ASX 200 company | Last share price | Trailing P/E ratio | Trailing Dividend Yield | 52-week high | 52-week low |
|---|---|---|---|---|---|
| CSL Limited (ASX: CSL) | $297.93 | 37.75 | 0.95% | $320.42 | $242 |
| Commonwealth Bank of Australia (ASX: CBA) | $103.75 | 23.08 | 2.39% | $106.57 | $62.64 |
| Westpac Banking Corp (ASX: WBC) | $25.12 | 21.5 | 3.54% | $27.12 | $16 |
| Australia and New Zealand Banking Group Ltd (ASX: ANZ) | $28.50 | 17.27 | 3.68% | $29.64 | $16.40 |
| National Australia Bank Ltd (ASX: NAB) | $26.69 | 20.49 | 3.37% | $27.84 | $16.56 |
| Macquarie Group Ltd (ASX: MQG) | $157.78 | 19.13 | 2.98% | $162.06 | $118.36 |
| Fortescue Metals Group Limited (ASX: FMG) | $23.05 | 8.27 | 10.72% | $26.58 | $15.62 |
| BHP Group Ltd (ASX: BHP) | $52.10 | 28.04 | 3.97% | $54.55 | $33.73 |
| Rio Tinto Limited (ASX: RIO) | $130.05 | 8.34 | 6.97% | $137.33 | $90.04 |
| Newcrest Mining Ltd (ASX: NCM) | $26.10 | 16.11 | 1.67% | $37.26 | $23.08 |
| Woodside Petroleum Limited (ASX: WPL) | $22 | – | 2.34% | $27.60 | $16.80 |
| Telstra Corporation Ltd (ASX: TLS) | $3.80 | 25.5 | 4.21% | $3.82 | $2.66 |
| Woolworths Group Ltd (ASX: WOW) | $40.05 | 35.75 | 2.52% | $44.06 | $35.96 |
| Wesfarmers Ltd (ASX: WES) | $63.95 | 38.57 | 2.58% | $63.95 | $43.50 |
| Coles Group Ltd (ASX: COL) | $18.01 | 22.9 | 3.36% | $19.26 | $15.28 |
| Transurban Group (ASX: TCL) | $14.31 | – | 2.55% | $15.64 | $12.36 |
| Sydney Airport Holdings Pty Ltd (ASX: SYD) | $7.72 | – | – | $8.04 | $5.02 |
| Afterpay Ltd (ASX: APT) | $132.15 | – | – | $160.05 | $69 |
And finally, here is the lay of the land for some leading market indicators:
- S&P/ASX 200 Index (XJO) at 7,538.4 points.
- All Ordinaries Index (XAO) at 7,86.5 points.
- Dow Jones Industrial Average Index (DJX: .DJI) at 35,209 points after rising 0.41% on Friday night (our time).
- Bitcoin (CRYPTO: BTC) going for US$45,056 per coin.
- Gold (spot) swapping hands for US$1,764 per troy ounce.
- Iron ore asking US$172.35 per tonne.
- Crude oil (Brent) trading at US$70.70 per barrel.
- Australian dollar buying 73.54 US cents.
- 10-year Australian Government bonds yielding 1.19% per annum.
That's all folks. See you next week!
