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ASX Live Coverage – Monday, May 19
Welcome to our live coverage of the Australian Securities Exchange (ASX) for May 19. We invite you to refresh this page for continuous updates and share your feedback on how we can enhance this experience.
Dicker Data CEO Resigns
[9:05 am] David Dicker, co-founder of Dicker Data, has announced his decision to step down as CEO, Chairman, and Director to focus on other interests. Despite stepping down from executive duties, Dicker will provide strategic consultancy to the company for six months at the Board’s request. As the largest shareholder, owning approximately 47.47% of shares as of March 19, 2025, his potential sell-off of shares could negatively affect the stock price.
Source: ASX Announcement | Dicker Data (DDR)
US Credit Rating Downgrade
[8:55 am] Moody’s has downgraded the US credit rating from AAA to Aa1, a significant move noting the following insights:
- A decade-long rise in federal debt and interest payment ratios has exceeded those of similar-rated sovereigns.
- Continuous failure by US administrations to address substantial fiscal deficits, which hit US$1.8 trillion in 2024 and are running at US$1.05 trillion year-to-date in 2025, reflecting a 13% increase from the previous year.
- Mandatory spending on programs like Social Security and Medicare, coupled with low revenue generation, is contributing to fiscal challenges.
- An extension of the 2017 Tax Cuts and Jobs Act, a priority for the Trump administration, could add US$4 trillion to the primary deficit over the coming decade.
This downgrade is unprecedented in over a century for the US, stripping it of a AAA/Aaa rating from any major agency, which may lead to increased borrowing costs and impact consumer borrowing rates.
Highlights from Livewire
Explore these significant articles from Livewire:
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Are US Treasuries still the world’s safety net?: US Treasuries, once viewed as a risk-free asset, now face challenges due to fiscal deficits and waning foreign demand, although they remain essential for portfolio stability.
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Sell in May, go away and lose money: Historical analysis from 1875 to 2025 reveals no significant seasonal pattern in Australian equities, debunking the "sell in May" strategy.
- Rare earths are a big deal right now – but are they a buy?: China’s export restrictions on critical rare earth elements have heightened geopolitical tensions, positioning Australia as a key supplier through companies like Lynas Rare Earths.
Stock Market Overview
[8:40 am] The overnight session was relatively calm, with major US indexes concluding the day positively (S&P 500 +0.70%, Nasdaq +0.52%, Dow +0.78%). Factors influencing the market include:
- De-escalation of US-China tariffs, which is positively affecting investor sentiment.
- A resurgence in Mergers & Acquisitions (M&A), highlighted by Dick’s Sporting Goods’ interest in acquiring Foot Locker for US$2.4 billion and Charter’s US$34.5 billion acquisition of Cox.
- The VIX index has declined to 17, approaching a three-month low.
- The US 10-year yield remains steady, slightly below the crucial 4.5% level.
Morning Update
[8:35 am] S&P/ASX 200 futures indicate a decline of 8 points (-0.08%) as of 8:30 am AEDT. If you’re new to our coverage, be sure to catch up with today’s Morning Wrap for key insights.
This summary synthesises essential updates and insights into current market trends and events impacting the ASX and global financial landscape. Stay informed and engaged as we continue to provide timely updates throughout the day.
