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ASX closes lower, Afterpay hit after Square deal delay

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The S&P/ASX 200 closed lower Thursday, dropping 10.70 points or 0.15% to 7,225.20, hitting resistance at the 200-day moving average on a one-day chart. The RSI is showing the market has moved out of the oversold region that it dipped into after last Friday’s covid-related selloff.

US futures are higher indicating gains at the open there. The Nikkei 225 is down -0.4%, the Hang Seng is +0.2% and the CSI 300 is +0.2% at 4.07pm AEDT.

In local news, grocery retailer Woolworths trumped Coles owner Wesfarmers’ offer for Priceline owner Australian Pharmaceutical Industries with an $872m takeover bid. API shares closed up 16.1%, Woolworths was 0.4% higher and Wesfarmers was 1.7% higher.

Afterpay was one of the biggest decliners, down 6.1%, after notifying shareholders that it will delay its December 6 Scheme Meeting because a regulatory condition of its proposed $29bn takeover by US payments giant Square, which is changing its name to Block, remains outstanding. Afterpay will open the meeting on December 6, but immediately adjourn it to a date yet to be determined, but said both Square and Afterpay were sure the regulatory issue would be satisfied by mid-January 2022.

Crown Resorts was up 0.8%. Blackstone has been given access to the accounts of casino operator Crown Resorts after last month increasing its takeover offer to $8.5bn. While the latest bid “does not represent compelling value,” Crown will let the US buyout firm see private information as part of non-exclusive due diligence, Crown said Thursday. This will allow Blackstone to work on a fresh offer “that adequately reflects the value of Crown,” the company said.

Macquarie Group Ltd. said former Reserve Bank of Australia Governor Glenn Stevens will become its new chairman. Shares closed 1.6% higher.

The emergence of the new virus strain has roiled markets in recent days, with countries around the world stepping up travel restrictions. While some health officials said it could take weeks to reach a verdict, Australia’s Chief Medical Officer Paul Kelly said there is no indication that it is more deadly than other strains.

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