ASX First-Half Profit Up, but Focus on SGX Merger

Takeover target ASX posted a small three percent rise in first-half profit, but attention remains squarely on the completion of the $7.9 billion bid from the Singapore Exchange (SGX).

ASX CEO Robert Elstone devoted more than half of his report to the proposed merger.

For good measure, Elstone reminded governments that they should remember markets now demand seamless global trading.

The ASX-SGX deal still requires approval from the Australian government's Foreign Investment Review Board.

If the board gives the go-ahead, the deal will then be sent to both houses of parliament to clear a 15 percent cap on foreign ownership of the ASX.

Both companies want to team up to cut costs, and tackle growing pressure from alternative trading platforms.

These goals have taken on greater significance following global mergers this past week, including a Deutsche Borse-NYSE tie-up.

ASX shares ended slightly weaker Thursday, signaling perceived challenges ahead for the deal.

Shares of Qantas hit a near 5-week high, after the Australian national carrier reported a four-fold jump in profit, and signaled a return to growth.

Despite underperformance in its international business, and an A$80 million impact from the grounding of its A380 fleet, investors were cheered by upbeat comments from CEO Alan Joyce on capacity and yields.

First-half profits came in at A$241 million compared to A$58 million a year ago.

In Japan, Honda shares jumped over two percent, with the company expected to buy back more of its shares.

With the end of financial year just 6 weeks away, Honda's current payout ratio including dividends is around 23 percent.

Deutsche Securities says Honda may spend as much 35 billion yen ($420 million) to meet its target of returning 30 percent of profits to shareholders.

The Nikkei newspaper pegs the figure at 40 billion yen ($478 million).