The S&P/ASX 200 Index (ASX: XJO) managed to rise 6.3% last week despite it being a shorter trading week with the ASX closed on Friday.
The coronavirus continued to dominate headlines with numbers growing internationally. Australia grappled with the relationship between landlords and tenants – how much pain should each side go through? Some guidelines were created for commercial rentals, but residential rentals remain difficult.
Here are some of the other highlights of the week:
Landlord valuation pain
A number of real estate investment trusts (REITs) are going through pain right now with tenants unable to pay their rent. This is painful for cashflow but it also is hurting valuations.
Property giant GPT Group (ASX: GPT) announced this week that its GPT Wholesale Shopping Centre Fund recorded a negative revaluation of approximately $511 million, representing a decline in book value of around 11%. There may be more of these coming.
Capital raisings
A number of companies went to the market for capital raisings this week so that their balance sheets would remain in good shape.
Flight Centre Travel Group Limited (ASX: FLT) announced it would do a capital raising of around $700 million.
Property business Centuria Industrial Reit (ASX: CIP) announced a capital raising for $140 million.
Oil Search Limited (ASX: OSH) announced that it is doing a capital raising of up to US$700 million.
G8 Education Ltd (ASX: GEM) announced that it is doing a capital raising for $301 million.
APRA wants ASX banks to cut dividends
Earlier this week the Australian financial regulator asked banks to materially reduce their dividends so that they can remain financially sound during this period.
We don't know how long it's going to take for life to go back to normal – so banks will need to stay strong for the foreseeable future.
All eyes will be on Commonwealth Bank of Australia (ASX: CBA), Westpac Banking Corp (ASX: WBC), Australia and New Zealand Banking Group (ASX: ANZ) and National Australia Bank Ltd (ASX: NAB) to see what they do with their dividends over the coming months.
