Why Block, Fortescue, GUD, and Humm shares are sinking today

These ASX shares are ending the week deep in the red…

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Red line going down on an ASX market chart which symbolises a falling share price.

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The S&P/ASX 200 Index (ASX: XJO) is having another day to forget. In late afternoon trade, the benchmark index is down 2% to 6,457.4 points.

Four ASX shares that are falling more than most are listed below. Here’s why they are dropping:

Block Inc (ASX: SQ2)

The Block share price is down 6.5% to $82.19. This follows a very poor night of trade for the payments giant’s US listed shares. Investors were selling down stocks on Wall Street amid concerns that rate hikes could lead to a recession. The tech sector has been hit particularly hard. So much so, the S&P ASX All Technology index is down 2.2% at the time of writing.

Fortescue Metals Group Limited (ASX: FMG)

The Fortescue share price is down 4.5% to $18.76. Investors have been selling this mining giant’s shares on Friday amid weakness in the iron ore price. This appears to have been driven by concerns over China’s plan to form an iron ore cartel in order to control prices.

GUD Holdings Limited (ASX: GUD)

The GUD share price is down 20% to $7.71. Investors have been selling this products company’s shares following a profit warning. GUD has downgraded its underlying operating earnings guidance to $147 million in FY 2022. This is down from its previous guidance of $155 million to $160 million. In response to the news, Citi downgraded its shares and slashed its price target.

Humm Group Ltd (ASX: HUM)

The Humm share price has crashed 20% to 46 cents. The catalyst for this has been the collapse of the sale of the company’s BNPL business to Latitude Group Holdings Ltd (ASX: LFS). The two parties agreed to mutually terminate the $250 million deal, which was opposed by a large shareholder and director. Judging by the share price reaction, the market appears to think that Humm has been left holding a lemon.

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Block, Inc. The Motley Fool Australia has positions in and has recommended Block, Inc. The Motley Fool Australia has recommended Humm Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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