Heading into the New Year's holiday trading volumes on the ASX remained thin although that didn't stop several popular shares plunging lower as investors headed for the exits. Let's take a look at what may be behind some of today's price action.
Domino's Pizza Enterprises Ltd. (ASX: DMP) shares dropped 3.1% to $57.48 despite the pizza chain releasing no specific news to the ASX. The business recently announced the acquisition of a German pizza chain for a price tag up to EUR 79 million, which it expects to be 4%-5% earnings accretive on an adjusted FY15 pro forma basis. This news put a rocket up the share price and with the stock up 127% in 2015, today's selling is likely the result of some profit taking.
Bellamy's Australia Ltd (ASX: BAL) is the baby formula business that has been on a tear recently thanks to soaring demand for its organic baby food products. Today the shares fell 9.4% to $14.02 in what is the consequence of profit taking and day traders trying to take advantage of a volatile share price.
Northern Star Resources Ltd (ASX: NST) shares fell around 3.15% today despite the gold miner releasing no news to the market. Recent Australian dollar strength may not have helped this stock, while the start of a US rate-hiking cycle may also put pressure on the spot gold price as its attractiveness as a safe haven diminishes versus money market and other types of US dollar linked securities.
Freedom Foods Group Ltd (ASX: FNP) shares crashed 10% as 'bubble talk' starts to hit the infant formula and dairy sector, with some investors taking a profit while the going remains good. Freedom Foods is also in the fast-growing gluten and allergen free premium food markets and has a reasonable long-term outlook, although investors must be sure to pay a reasonable price for the expected growth.
