ASX up after Evergrande pledge to pay: Wednesday 22 September

Steven Deare
(Australian Associated Press)


Investors took confidence from troubled property giant Evergrande pledging a payment, while they wait for US monetary policy decisions.

The Australian market closed modestly higher on Wednesday after the Chinese group committed to paying bond interest on Thursday.

There are fears Evergrande will default on its mountain of debt, leaving consequences for companies and investors around the world. The bond interest is the first in a series of hefty debts due.

ASX investors showed little fear in buying energy and mining shares and made them the best categories of the day.

Mining giant Fortescue rose 4.2 per cent to $15.37. BHP and Rio Tinto gained more than two per cent.

Banks closed lower as concerns remain they may be exposed if Evergrande cannot repay debts. Westpac fared worst and lost 1.11 per cent to $24.91.

Financials were the worst performing category and shed 0.62 per cent.

The benchmark S&P/ASX200 index closed higher by 23.1 points, or 0.32 per cent, to 7296.9.

The All Ordinaries closed up by 30.7 points, or 0.41 per cent, to 7593.8.

US Federal Reserve policy decisions will give investors more to consider when they are revealed on Thursday.

The central bank previously said it may start winding back its massive purchases of government debt this year. This has helped rates stay low during the pandemic.

Investors will be looking for clues on whether and when the Federal Reserve may start easing this stimulus.

Officials will also reveal their forecasts for when interest rates will rise.

In company news, Westpac confirmed it will no longer sell its Pacific businesses to Kina Securities.

Papua New Guinea’s competition watchdog recently stopped the $420 million sale of Westpac Fiji and Westpac PNG.

The bank will assess other exit options.

Energy provider AGL defeated climate activists’ attempts to more quickly part with its coal-fired power, including an 18-year-old challenger for a board role.

Shareholders at an annual general meeting criticised the declining financial performance amid AGL’s shift to renewable energy.

Bendigo Bank chair Jacqueline Hey was re-elected to the board.

Shares were up 2.9 per cent to $5.68.

Other energy providers doing well on the market included Beach, which gained 5.12 per cent to $1.13. Woodside rose by 2.44 per cent to $21.43.

Buy now, pay later provider Zip is paying $US50 million for a minor stake in Indian operator ZestMoney.

ZestMoney has had 11 million users and is available in more than 75,000 shops.

Shares were up 4.33 per cent to $6.51.

Rival Splitit fared better. Its shares rose 6.41 per cent to 41 cents.

The Australian dollar was buying 72.53 US cents at 1724 AEST, lower than 72.73 US cents at Tuesday’s close.


* The benchmark S&P/ASX200 index closed higher by 23.1 points, or 0.32 per cent, to 7296.9 on Wednesday.

* The All Ordinaries closed up by 30.7 points, or 0.41 per cent, to 7593.8.

* At 1724 AEST, the SPI200 futures index was up 16 points, or 0.22 per cent, at 7292 points.


One Australian dollar buys:

* 72.53 US cents, from 72.73 cents on Tuesday

* 79.42 Japanese yen, from 79.69 yen

* 61.83 Euro cents, from 61.97 cents

* 53.11 British pence, from 53.16 pence

* 103.20 NZ cents, from 103.43 cents.


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