The S&P/ASX 200 (ASX: XJO) fell 0.3% on Wednesday, driven lower by the consumer staples sector, which was down 1.4%. The majority of the weakness came from Coles Group Ltd (ASX: COL) and Woolworths Group Ltd (ASX: WOW), with the latter down 1.9% as the rotation away from defensives continued.
Only three sectors finished in the black, with materials, industrials and utilities benefitting from continued signs of a robust economic recovery. BHP Group Ltd (ASX: BHP) added 1% after the iron ore price reached US$210 once again.
The real estate sector was the other low light, falling 1.1% even as Dexus Property Group (ASX: DXS) announced a long-term partnership with Australian Unity’s healthcare property platform.
Westfield-Unibail-Rodamco (ASX: URW) continued its recent volatility, jumping 7.7% as the UK lockdowns look set to be removed.
Chinese business inflation hits record
The Chinese seem to be facing the same issues as the rest of the world, with inflation just 1.3% higher in the year to May, below expectations and suggesting little risk that the economy is overheating.
On the other hand, producer price inflation, which measures input and other costs hit a 2008 record, jumping 9% as commodity prices hit producers.
Brickworks share price surges
Brickworks Ltd (ASX: BKW), which owns 39% of Washington H Soul Pattison and Co Ltd (ASX: SOL), runs its own building products division and controls a significant property portfolio reached a record high, jumping 11.3% on Tuesday.
BKW share price chart
Management now expects record profits from its Joint Venture Industrial Property Trust, which includes the construction of warehouses for Amazon and Coles, to hit $100 million.
The profit is said to be sourced from the realisation of the full value of these assets once construction is complete and should send property earnings to between $240 million and 260 million.
Despite the massive building boom in Australia and the US, Brickworks did not offer any visibility on the earnings expectations for these divisions.
Monash converts LIC
Monash Absolute Investment Company Ltd (ASX: MA1) marked the dawning of a new future for listed investment companies (LICs), in my view at least.
Monash has decided to convert their listed investment company, which has traded at a discount to NTA for many years, into an exchange-traded managed fund, the first such to occur in Australia.
This will make it more easily investable, remove the discount and likely reduce the costs.
Featured video: Interview with Simon Shields, Monash Investors
ASX 200 today
Looking ahead, the ASX 200 is expected to open relatively flat on Thursday following a negative lead from US markets overnight. For all the latest, check out Rask Media’s US stock market report.
