The Australian share market is weaker, with all sectors down except the telcos following news of a $1.4 billion takeover deal.
IG Markets market strategist Evan Lucas says there’s been an explosion of positive trade in internet providers TPG and iiNet, with iiNet set to be scooped up by its rival TPG in “the worst kept secret in the telecommunications industry”.
“This has been floating around for six months to a year,” he said.
“It’s a marriage made in heaven. The synergies are ginormous and the deal looks very good for both sides.”
Shares in iiNet rocketed $1.81, or 26.6 per cent, to $8.62, while TPG surged $1.26, or 16.3 per cent, to $9.00.
Meanwhile, Amcom lifted 14 cents to $2.75, but Telstra was down six cents at $6.23.
The deal was not enough to boost the local bourse however, with everything else in the red driven by losses in the banks and miners.
Mr Lucas said the index moved up one per cent on Thursday following a fall in the unemployment rate that was not good enough to scuttle an expected Reserve Bank rate cut.
“(The market) probably got ahead of itself,” he said.
“The banks, particularly, were overbought and a lot of that has been given back today.
“Whenever the big four banks go backwards, the index will be down. They carry the rest of the market with them.”
Commonwealth Bank was down 40 cents at $91.42, Westpac was 33 cents lower at $37.76, ANZ fell 25 cents to $35.39 and National Australia Bank was 19 cents weaker at $37.81.
The miners also pulled back despite a slight lift in the iron ore price overnight.
BHP Billiton fell 47 cents to $29.73, Rio Tinto lost 36 cents to $57.14 but iron or miner Fortescue Metals was three cents higher at $1.945.
Woodside Petroleum lost six cents to $34.73 and Santos was 17 cents weaker at $7.13.
KEY FACTS
* At 1200 AEDT on Friday, the benchmark S&P/ASX200 index was down 37.6 points, or 0.64 per cent, at 5,812.6.
* The broader All Ordinaries index was down 31.6 points, or 0.54 per cent, at 5,784.4.
* The March share price index futures contract was down 38 points at 5,808 with 17,516 contracts traded.
* National turnover was 524 million securities worth $1.27 billion.