CSL drags down early trading after billion-dollar misfire on heart drug

A failed drug trial by Australia’s third-largest company has dragged the local bourse into the red at the start of the week’s trading.

Feb 12, 2024, updated Feb 12, 2024
CSL has dragged down morning trading.  (AAP Image/POOL, David Caird)

CSL has dragged down morning trading. (AAP Image/POOL, David Caird)

At noon AEDT on Monday, the S&P/ASX200 was down 13 points, or 0.17 per cent, to 7,631.8, while the broader All Ordinaries had dropped 9.4 points, or 0.11 per cent, to 7,875.3.

CSL was down five per cent to $289.75, causing nearly a 22-point drop in the ASX200, meaning the benchmark index would be slightly in the green without those losses.

The blood products company was on track for its worst day since a 6.3 per cent drop on October 13 after announcing a plasma-derived treatment it had spent almost $1 billion developing did not appear to prevent second heart attacks, as CSL had hoped.

“Substantial work remains to fully analyse and understand the complete data and then to determine any development path ahead for this asset,” CSL research and development head Dr Bill Mezzanottee said.

CSL’s losses meant the ASX’s health care sector was down 3.5 per cent at midday. Eight of the bourse’s other 10 sectors were higher, all except mining and energy.

JB Hi-Fi had jumped 6.9 per cent to an all-time high of $60.47 after the electronics and home appliances retailer beat expectations with a more modest drop in first-half sales and profit than analysts were expecting.

“We are pleased with our performance as we cycled the elevated customer demand in the prior year,” said group chief executive Terry Smart.

The Big Four banks were all in the green, with ANZ adding 1.4 per cent, NAB climbing 1.2 per cent, Westpac up 0.8 per cent and CBA edging 0.1 per cent higher.

In the heavyweight mining sector, BHP and Rio Tinto were both down 0.8 per cent, while Fortescue had added 0.3 per cent.

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The ASX’s tech sector was the biggest gainer, rising 1.3 per cent as Audinate, Appen and Brainchip all posted double-digit gains.

Audinate had soared 19.5 per cent to an all-time high of $19.16 after the media networking company announced its first-half operating earnings were up 137 per cent to a record $10.1 million, driven by strong demand for products in its Dante ecosystem of professional audio/visual equipment.

Appen was up 17.9 per cent to 33c after the struggling machine learning dataset company announced it would close two offices in North America and trim “direct costs” – usually a codeword for layoffs – after losing a $82 million contract from Google.

Appen shares are still down 71 per cent since the start of the year, however.

Synlait Milk had fallen 14.5 per cent to 68c after the Kiwi milk company forecast it would announce a $17 million to $21 million net loss for the six months to January 31.

“The board and management are actively working on the need to deleverage Synlait’s balance sheet as a priority,” the company said.

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