Markets Live: Japan stimulus helps ASX close higher
Australian shares have closed higher after Japan followed the US Federal Reserve and the European Central Bank in providing more monetary easing to stimulate the economy.
- Japan eases monetary policy as slowdown bites
- David Jones offers predators food for thought
- Macmahon CEO exits, outlook slashed
- Dollar slips as stimulus optimism wanes
4.51pm: That's all from us here at blog central, thanks for reading and commenting, we'll be back tomorrow from 9.30am.
4.47pm: Some notable movers for the day: Fortescue continued its rise, up 5.4 per cent, Iluka added 3.2 per cent and gold miner Newcrest jumped 3.1 per cent.
Mining and construction company Macmahon Holdings plummeted 38.7 per cent after it announced a profit downgrade, just one month after posting record profits.
4.31pm: Here's a look at how blue chip stocks performed today:
- BHP: +0.77%
- Rio: +0.96%
- ANZ: +0.66%
- CBA: +0.11%
- NAB: -0.12%
- Westpac: +0.62%
- Fortescue: +5.43%
- Woolworths: +0.81%
- Wesfarmers: +1.19%
- Telstra: +0.53%
4.19pm: European stock index futures pointed to a higher open as fresh monetary stimulus from Japan boosted assets exposed to global growth and offset worries about Spain's fiscal issues.
Futures for London's FTSE are up 0.2 per cent, the Euro STOXX 50 and Germany's DAX were up 0.4 per cent while contracts on France's CAC were 0.6 per cent higher.
While in the US, the Dow Jones and S&P500 futures are both up 0.4 per cent.
4.16pm: The gold sub-index led the gains, rising 2.5 per cent, followed by materials, up 1.3 per cent. Consumer stapes gained 0.7 per cent and financials added 0.2 per cent. Property trusts posted the only sub-index loss, falling 0.4 per cent.
4.12pm: The market has closed higher, buoyed by stimulus measures from the Bank of Japan. The benchmark S&P/ASX200 index jumped 23.7 points, or 0.5 per cent, to 4418.4, while the broader All Ords added 22.6 points, or 0.5 per cent, to 4440.4.
3.49pm: Chinese authorities have said the country has been made a victim of US electoral politics after Washington launched an international trade case alleging that Beijing has been unfairly subsidising automobile and auto parts exports.
US President Barack Obama announced the World Trade Organization (WTO) case against China over allegedly illegal subsidies for automobiles and auto parts during an election campaign stop in Ohio on Monday.
"In the midst of an election race, the United States chose to announce this news in Ohio, an automobile production area, showing that the US took this step against China out of considerations of electoral politics," an unidentified Chinese commerce official said on the ministry's website.
"We express our opposition to this," said the official, adding that China would deal with the US request for consultations in keeping with WTO rules.
3.42pm: With a short while to go until the close of trade, here's what CMC Markets senior trader Tim Waterer had to say about the day's movements:
- Central bank action has been coming thick and fast in recent weeks and whilst the news of stimulus today from the BOJ is generally welcomed, it is the Peoples Bank of China that traders really want to hear from when it comes to concrete measures to kick start their economy.
- What was looking like being a directionless session across Asia definitely received a reprieve in the form of the BOJ announcement. Gold moved around US$5 higher on the news and this was enough to assist the AUD. The Euro also took well to the news, moving around a quarter of a US cent higher. Market reaction by risk assets to the BOJ stimulus measures may have been only lukewarm when compared to the initial QE3 buying bonanza, however we have again seen how central bank pro-activity can quickly lift the mood of financial markets.
- Following an indifferent start, the Australian sharemarket found its groove in the afternoon with the ASX200 reclaiming the 4400 level, and then some. The monetary stimulus measures announced by the BOJ were well received by commodities such as gold and oil which both turned higher, with these moves translating into reasonable gains for the local mining stocks. Attention will now turn to Chinese HSBC Flash Manufacturing PMI data due tomorrow. If we indeed see another sub 50 print, just how far below this benchmark level the number comes in at may be key in determining how Asian bourses fare tomorrow.
3.34pm: Looking ahead to tomorrow, China's flash purchasing managers index (PMI) is due out. It is worth noting the market has reacted sharply to poor news over previous months.
‘‘The flash PMI has been below 50 for the past 13 of 14 months and August PMI came in at the lowest level since March 2009,’’ said ANZ analysts. ‘‘However, we note that, compared to the official PMI, this series is volatile, biased towards SMEs and is based on a smaller sample size.’’
3.30pm: Apple, the world’s biggest technology company, and four publishers offered to avoid fixing the retail price of e-books in Europe for five years to end a European Union antitrust probe over price-fixing for digital books.
Details of a settlement proposal by Apple, CBS’s Simon & Schuster, News Corp’s Harper Collins, Verlagsgruppe Georg von Holtzbrinck GmbH’s Macmillan unit and Lagardere SCA’s Hachette Livre were published today in the EU’s Official Journal.
The European Commission said they first made an offer to settle its investigation in April.
For two years, the four publishers won’t limit e-book retailers’ discounts or promotions as long as the total value of a retailer’s discount doesn’t exceed the commission it received from the publisher over a 12-month period.
3.21pm: And while we're in Japan: Japan Airlines has marked a successful return from bankruptcy when its shares took off after relisting in Tokyo, three years after it became one of the nation's worst ever failures.
The carrier jumped to 3905 yen, up 3 per cent on the offer price, in early trade following an offering that raised around $US8.5 billion, the second biggest in the world this year after Facebook.
It lost a little altitude as the morning went on, but remained at a premium to the offering.
3.17pm: Here's how the region's sharemarkets are doing after the Bank of Japan's QE announcement:
- Japan (Nikkei): +1.6%
- Hong Kong: +1.3%
- Shanghai: +0.4%
- Taiwan: +0.5%
- Korea: +0.3%
- Singapore: +0.2%
- New Zealand: -0.1%
3.14pm: BHP Billiton says the pace of iron ore demand from China has slowed by more than half.
‘‘We’re already seeing the beginning of the end of the first phase of economic development in China,’’ Alberto Calderon, the Melbourne-based company’s chief commercial officer and manager of its aluminum and nickel business, said today at a conference in Canberra.
‘‘The pace of demand of iron ore from China has slowed down by more than half.’’
BREE, the federal government's official resources forecaster, yesterday cut its price forecasts for this and next year on concern that a slowing economy in China will curb demand growth.
3.07pm: The big news for regional - and the local - markets this afternoon is the Bank of Japan's next round of monetary easing, coming in the wake of the Fed launching a third round of bond buying known as quantitative easing (QE) last week and after the European Central Bank earlier this month outlined its bond-buying scheme to ease fiscal strains for eurozone countries seeking assistance.
"The BOJ had to move after the Fed and the ECB took action, and market reactions reflect such sentiment," says Hiroshi Maeba, head of FX trading Japan for UBS in Tokyo.
The Aussie dollar jumped to 82.8 yen on the news, from 82 yen, while the Nikkei stock average rose 1.3 per cent from a 0.5 per cent gain prior to the BOJ announcement.
2.53pm: Economist Stephen Koukoulas is sceptical about the S&P prediction, tweeting:
S&P have not published ANY economic parameters that underpin its deficit forecast. Looks like it is a made up number #auspol
I can produce scenarios where the 2012-13 Budget outcome will be in the range of a $40 b surplus to a $40 b deficit. Just silly
2.48pm: Australia will record a budget deficit of $20 billion - $25 billion this year, ratings agency Standard & Poor's is saying, slashing its earlier estimate of a $1 billion surplus.
S&P’s senior director of sovereign ratings Tan Kim Eng says the cut is mainly due to global economic problems.
“Firstly the export sector is not doing as well as initially expected, commodities exports have not been as strong, on the other hand expenditures are rising,” he says.
Despite the deficit warning, S&P has reaffirmed Australia's AAA rating.
2.36pm: More on the Bank of Japan's monetary easing announcement, last week's stimulus measures from the US Fed had piled pressure on the the BOJ to follow suit with its own steps to support an economy feeling the pinch from a strong yen and the widening fallout from Europe's debt crisis.
"We expect today's decision ... will help ensure that Japan's economy resumes a sustainable growth path with price stability," the BOJ said in a statement.
The potential economic fallout from an escalating territorial dispute with China, Japan's biggest trading partner, has added to headaches for policymakers fretting about the damage from a strong yen and weakening global demand on exports.
2.21pm: Wesfarmers says it intends to appoint SEEK internet job website co-founder Paul Bassat to its board, subject to shareholder approval at its November annual general meeting.
Shareholders will be asked to approve the expansion of the board beyond its current limit of 10 members to facilitate the appointment.
Melbourne-based Mr Bassat (44) co-founded SEEK in 1997, and served as chief executive and then as joint chief executive from 1997 until 2011.
Shares in Wesfarmers are up 49 cents, or 1.42 per cent, to $34.91.
2.11pm: The Bank of Japan has eased monetary policy by boosting asset purchases, as slowing global demand and heightening tensions with China hurt chances of a near-term recovery in the export-reliant economy.
The central bank expanded its asset buying and loan programme, currently its key monetary easing tool, by 10 trillion yen to 80 trillion yen, with the increase to be for purchases of government bonds and treasury discount bills.
The deadline for meeting the overall target was extended by six months to December 2013.
As a result the Australian dollar is up against the Yen (see table below).
2.04pm: BusinessDay's Adele Ferguson weighs in on David Jones putting a higher price tag on its flagship CBD properties:
The battle to get people back shopping at David Jones department stores and whet the appetite of would-be predators began in earnest today when the company put a $612 million value on its four flagship buildings in Sydney and Melbourne, which equates to half its current market capitalisation
Department stores have long been tagged dinosaurs and the 40 per cent fall in the net profit of David Jones for 2012 did little to allay those thoughts, particularly given its poor internet strategy, addiction to discounting and foolhardy decision to reduce costs by cutting staff, which resulted in poor customer service.
Like Myer, David Jones refused to give guidance for 2013 but it is likely to be similar to its 2012 earnings given it will lose 50 per cent of its earnings from its credit card business.
1.55pm: Here's a quick snap shot of how markets around the region are performing:
- Nikkei(Japan): +0.20%
- Shanghai: +0.17%
- Taiwan: +0.25%
- South Korea: -0.32%
- Singapore: +0.15%
- New Zealand: +0.21%
1.44pm: The resources boom will become a drag on the economy in about eighteen months, two eminent economists say, in contrast to government claims the boom will benefit the nation for many years to come.
Former RBA board member Bob Gregory and a former head of the Victorian Treasury, Peter Sheehan, argue in a new paper that economic activity will start to be eroded by the boom from about early 2014.
While the mining boom has been the main driver of economic activity for the last decade, they argue this will soon change, due to weaker commodity prices and a looming peak in mining investment.
With iron ore prices 40 per cent below last year’s record highs, most economists now agree commodity prices have peaked.
1.36pm: ANZ has made a $224 million windfall after offloading its remaining stake in global payments major Visa.
The sale was prompted in part by tough new global rules that require banks to hold greater level of capital.
ANZ received its shareholding in the San Francisco-headquartered Visa as part of the 2008 stock market listing of the credit card provider.
The Melbourne-based bank initially was issued around 7.95 million shares in Visa when it listed, given it is one of the biggest issuers of Visa through Asia and Australia.
ANZ today said it has sold 3.5 million Visa shares in resulting in an after tax profit of $224 million.
1.20pm: As the ASX approaches a gain of 0.5 per cent for the day, it's worth seeing the sectors which are driving shares higher:
- Info tech: +1.68%
- Health: +1.24%
- Consumer staples: +0.84%
- Materials: +0.75%
- Utilties: +0.59%
- Consumer disc.: +0.4%
- Telecoms: +0.36%
1.14pm: Japan Airlines marked a spectacular return from bankruptcy when its shares took off after relisting in Tokyo, three years after it became one of the nation's worst ever corproate failures.
The carrier jumped to 3905 yen ($A47.63), up 3.03 per cent on the offer price, in early trade following an offering that raised around $8.5 billion, the second biggest in the world this year after Facebook.
It lost a little altitude as the morning went on, but remained at a premium to the offering.
JAL's rebirth marked a stunning turnaround for the airline after it crashed into insolvency, owing 2.3 trillion yen ($29 billion), one of Japan Inc.'s most costly corporate meltdowns. The embattled airline continued flying while it went through a rehabilitation process under court protection.
1.03pm: Looking at the performance of markets in recent days, CMC foreign exchange dealer Tim Waterer said the mood had changed since the initial euphoria of the ECB and US Fed announcements.
‘‘It seems that traders in general are just taking stock of the recent announcements overseas form the ECB and the FOMC,’’ he said.
‘‘All of that was on the back of a general questioning of whether the market got ahead of itself in celebrating QE3, which has given pause to a lot of risk assets. It looks like the Australian dollar is suffering a little bit due to the softening of commodity prices as well.’’
Mr Waterer said markets are now waiting the release of HSBC Chinese manufacturing activity index for September, which is due out tomorrow.
12.55pm: The gold sub index on the ASX200 is 1.4 per cent higher, and Newcrest, one of the world's top five gold mining companies, is 2.36 per cent higher, but the price of gold is down.
Gold fell $US5.30 an ounce to $US1766.39, moving away from a near 7-month high of $US1777.51 hit on Friday, when the US Fed's latest move to spur the economy led to a rush for bullion.
"On the chart as well, gold prices look oversold, and it could be vulnerable to some profit-taking. Apparently, there's high resistance at around the $1800 level," said Natalie Robertson, a commodities analyst at ANZ.
12.48pm: The chairman of embattled paper, sign and display supplier PaperlinX has quit the board, along with two other directors.
The departure of the chairman and two directors from the loss-making company follows that of PaperlinX chief executive Toby Marchant in July.
Chairman Harry Boon and non-executive directors Lyndsey Cattermole and Anthony Clark had resigned from the board, effective from September 28, PaperlinX said today.
12.46pm: Markets are turning a slow start into a good day. The All Ords and the ASX200 are now 0.3 per cent higher.
12.42pm: Ten shares have responded positively to news of the Russell Howcroft's appointment. They're up 1 cent, or about 3 per cent, to 36 cents.
12.36pm: Here's more on Russell Howcroft's appointment at Ten. The press release says:
Based in Melbourne, Mr Howcroft will be responsible for Network Ten’s operations in Melbourne, Brisbane, Adelaide and Perth. Network Ten’s station managers in Brisbane, Adelaide and Perth will report to Mr Howcroft. He will join the company’s Executive Team, reporting to Network Ten Chief Executive Officer James Warburton.
Russel is extremely well connected in the marketing, advertising and media sectors. His appointment will bring new skills and strengths to the Network Ten management team, particularly in the Melbourne market.
12.28pm: BREAKING Russell Howcroft, a former ad man better known for his work on the ABC's Gruen Transfer, has been appointed general manager of Ten Network. More soon.
12.22pm: Since about 10.30am, after a soft open, stocks have risen strongly to a gain of about 0.2 per cent. Gold stocks are 1.5 per cent higher and info tech stocks are 1.6 per cent higher. The All Ords and the ASX200 are about 0.2 per cent higher.
12.18pm: Telco reporter Lucy Battersby writes that Telstra is matching its competitors’ data allowances for smartphone customers with a new offer on certain two-year plans.
Telstra will give an extra gigabyte of data every month for the first year to customers spending at least $80 per month on an Every Day Connect plan. Customers will get a smartphone and 2.5 gigabytes (GB) per month for the first year, dropping back to 1.5 GB per month in the second year. This compares with Optus and Vodafone currently offering 2 GB per month for the life of an $80 per month two-year plan.
And customers who already own a smartphone and paying $60 per month will also get an extra gigabyte every month for the first twelve months. Vodafone offers sim-only customers 2 GB per month for $65 and 3 GB for $85 per month. Optus offers 1.5GB for $60 per month and 2GB for $80 per month.
In 2010 and 2011 the mobile carries were competing on price. But data allowances and speeds are the new battleground now that more customers have internet-enabled smartphones. Hype around 4G network speeds is also driving interest.
12.09pm: Treasurer Wayne Swan says Australia can’t ignore the rapid rise of Asia when it trades with countries wanting to buy its commodities and services.
Mr Swan, who was speaking at a conference ahead of the release of a government white paper on the Asian century, said too often the broader Australian economic story gets clouded by China data or daily commodity price movements.
He says he is often asked if Australia was too dependent on China and rising Asian economies.
‘‘It’s extremely difficult to make a case that we should be doing less trade with the fastest-growing, most dynamic region in the world,’’ Mr Swan has told the Structural Change and the Rise of Asia Conference in Canberra.
11.58am: Oil is trading near its lowest close in more than two weeks after an industry report showed rising crude stockpiles in the US and Saudi Arabia was said to be taking action to lower prices.
“The market is fully priced given the current demand and supply fundamentals,” Ric Spooner, a chief market analyst at CMC Markets has told Bloomberg. “An increase in the API inventory figures and reminders that Saudi Arabia has the capacity to produce more was enough to see prices drift off.”
Oil for October delivery is at $US95.51 a barrel, up 22 cents, in electronic trading on the New York Mercantile Exchange. The contract slid $1.33 yesterday to $US95.29, the lowest close since August 30.
11.44am: Latest figures show Australian economic conditions are solid but below average and are likely to stay that way for the coming months.
The Westpac-Melbourne Institute Leading Index, which indicates the likely pace of economic activity three to nine months into the future, rose to 2.2 per cent in July, below its long-term trend of 2.7 per cent.
Westpac chief economist Bill Evans says while the index has recently shown some improvement, it’s still below trend.
Mr Evans says Westpac anticipates more robust growth outcomes for next year will require more interest rate relief but he expects the RBA will hold off making cuts until November.
11.35am: Jewellery chain Michael Hill International, whose relocation to Australia generated tax benefits, says it will shortly respond to the Australian Tax Office’s challenge to its valuation of intellectual property.
The ATO disputes about $NZ40 million ($31.95 million) of the $NZ50.2 million ($40.09 million) deferred tax asset raised as a result of the IP being transferred to an Australian unit of Michael Hill from a New Zealand unit.
Shares of Michael Hill last traded unchanged at $NZ1.19 and have climbed 33 per cent this year.
11.26am: Australia’s economy has adjusted well to the impact of the mining boom - which is likely to continue to for some time, the RBA says.
In a paper presented to the Structural Change and the Rise of Asia conference in Canberra, RBA assistant governor Christopher Kent says the boom has been generally advantageous for Australia.
‘‘While not all parts of the economy have benefited equally, the process of structural adjustment has occurred relatively smoothly overall,’’ he says.
‘‘Output has grown at close to trend rates, unemployment has remained relatively low and inflation has been close to target.’’
11.16am: The big banks are also lower but in line with the general market:
- CBA is 0.24% lower to $55.16
- ANZ is 0.16% lower to $24.35
- NAB is 0.31% lower to $25.48
- Westpac is 0.21% lower to $24.30
11.10am: Investors have not welcomed the David Jones news. Its shares have lost 2.2 per cent while competitor Myer has added 0.5 per cent. Wesfarmers has added 0.23 per cent, Woolworths is flat, Westfield is 0.7 per cent higher and Harvey Norman is down 0.9 per cent.
11.04am: While the Aussie is weaker this miorning and could fall further through to the end of the week, ANZ analysts think there is some strong upside in the local unit's recent performance.
The currency may advance to $1.0850 after last week’s “impulsive move higher” took the currency above the 50- day, 100-day and 200-day moving averages, according to technical analysis by Timothy Riddell, head of global markets research at ANZ. The level was last seen on 29 February.
“Looking at the Aussie dollar’s performance since the beginning of September, the rally from $1.0165 to $1.0625 is considered an important impulsive move higher and opens the potential of a breakthrough,” Riddell said.
“Daily indicators have become positive and the Aussie has now regained levels above three standard moving averages.”
11am: The Aussie dollar is weaker in morning trade. It has slipped to $US1.0437, down from around $US1.0457 early today.
“Global drivers are going to still push the Aussie down,” said Joseph Capurso, a strategist at Commonwealth Bank of Australia.
“For the China HSBC PMI and the euro zone PMIs out this week, I think there’s still some downside risk there.”
10.55am: The positive sentiment following yesterday's announcement on its debt lifeline has pushed Fortescue shares higher again today, but the other big miners are down:
- BHP is 0.35% lower to $33.84
- Rio is 0.28% lower to $57.09
- Fortescue is 4.86% higher to $3.67
10.45am: Here’s a view on David Jones from CMC chief market strategist Michael McCarthy. Despite the weak profit result, he says "this is a positive step forward for David Jones because it shows the willingness of management to consider big changes".
They finally appear to be coming to grips with the structural challenges the industry is facing. They have a number of positive initiatives that are imminent that will deal with those structural issues.
10.42am: Both the All Ords and the ASX200 have fallen 0.1 per cent, well behind where the futures market was pointing. Gold stocks, however, have started brightly, adding 0.4 per cent in early trade.
10.38am: And now for the early gainers on the ASX200:
- Karoon Gas: +7.56%
- Bathurst Resources: +5%
- APN News & Media: +4.69
- Boral: +3.51%
- Fortescue: +3.43%
- Ten: +2
10.35am: As the market edges into negative territory, here are the major sliders on the ASX200:
- Aquarius Platinum: -8.19%
- Intrepid: -6.74%
- Goodman Fielder: -2.86%
- Decmil Group: -2.54%
- Leighton: -1.73%
10.30am: Shares in Macmahon are now edging toward a 50 per cent loss - down 47.17 per cent. Here's BusinessDay's Paddy Manning on today's share price plunge and the exit of chief executive Nick Bowen.
10.25am: Looking at how the various sub indices on the ASX200 are performing, defensives are up, industrials and energy stocks are down, and consumer staples are weaker:
- Health: +0.46%
- Info tech: +0.44%
- Telecoms: +0.36%
- Utilities: +0.33%
- Consumer staples: -0.2%
- Energy: -0.15%
10.20am: Macmahon shares were down 21c to 39c a few minutes ago after the company emerged from a trading halt imposed on Monday. Macmahon chairman Ken Scott-Mackenzie announced mining chief operating officer and former chief financial officer Ross Carroll had been elevated to CEO and managing director after six years with the company.
Macmahon, which is 20 per cent owned by Leighton Holdings, said it expected full year net profit after tax of between $20-$40 million this year blaming earthworks productivities at its Hope Downs 4 Rail Earthworks contract in Western Australia, which was under review, and ‘‘increased uncertainty about the outlook for new construction work given recent market volatility’’.
10.18am: The weak profit news from David Jones is starting to bite. Its shares have now lost 1.3 per cent to $2.24.
10.14am: In early trade, the All Ordinaries index is flat at 4418.3, while the benchmark S&P/ASX200 is is also flat at 4394.7.
10.10am: David Jones shares are flat in early trade. Despite reporting an almost 40 per cent drop in full year profits, its shares have lost 1 cent to $2.26. Here's the earnings story.
10.07am: Mining services company Macmahon Holdings has come out of a trading halt and is down 38.7 per cent, easily the biggest loser in early trade.
10.05am: Early take - markets open slightly higher. Up about 0.1 per cent.0.
9.57am: Where are markets headed today? Drop your thoughts into the comments field. Any companies on your radar? Let us know which ones and why.
9.55am: Australian bond futures prices are lower as an interest rate cut by the Reserve Bank of Australia later this year is looking more likely.
‘‘The market is a bit stretched at the moment after pricing in interest rate cuts for November and December,’’ Nomura rates strategist Martin Whetton said. ‘‘In our opinion we’re looking for a short-term fade in the market.’’
At 8.30am AEST, the December 10-year bond futures contract was trading at 96.750 (implying a yield of 3.250 per cent), down from 96.765 (3.235 per cent) yesterday.
The December three-year bond futures contract was at 97.380 (2.620 per cent), down from 97.400 (2.600 per cent).
9.51am: The China iron ore price continued its recovery overnight, rising $US4.50 to $US109.60. On 5 September, it had slumped to $US86.90 a metric tonne. The big miners posted mixed results in US trade. BHP lost 0.25 per cent while Rio added 0.72 per cent.
9.47am: Some analyst rating changes for today:
- Fortescue raised to 'buy' from 'hold' at RBS
- James Hardie downgraded to 'neutral' from 'buy' at BofA-Merrill lynch
- Sydney Airport cut to 'underperform' at BofA-Merrill Lynch
9.44am: Completing the retail picture this morning, Harvey Norman has upped the ante in its campaign against GST-free online goods, warning that if it left Australia for lower-cost countries, it would prompt an exodus among retailers.
Harvey Norman has been one of the major retailers campaigning, unsuccessfully, for imported goods valued at less than $1000 to be subject to the goods and services tax and tariffs.
9.42am: In other retail news this morning, a nearly two-decade veteran of Myer has resigned in the latest sign of upheaval at the troubled department store chain.
Myer executive general manager (stores) Nick Abboud tendered his resignation yesterday after 19 years with the company.
Mr Abboud had been in charge of "all aspects of Myer's store operations from conceptualisation to delivery of operational strategies."
9.37am: To the major local news of the morning. David Jones has posted a nearly 40 per cent drop in net profit and flagged a review of its property holdings as it battles a worsening environment for traditional retail business.
Net profits in the year to July dropped 39.9 per cent to $101.1 million, down from $168.1 million, the company said this morning, in line with earlier guidance.
Chief executive Paul Zahra said the result "reflects the difficult trading environment during the year as well as the investment we have made in the second half of 2012 implementing our Future Strategic Direction Plan". Full story.
9.32am: Markets were down overnight on investor doubts about the eurozone. In other words, the shine has come off Mario Draghi's plan to support ailing southern European economies.
"Europe is an overhang that's still there on the US market. Their debt crisis is not being handled, it's Band-Aids here and there. It's slowing us down," said Thomas Nyheim, a US fund manager at Christiana Trust, which oversees about $US13 billion.
What does that mean for Aussie markets? The SPI is pointed higher, but European and US markets were down and the dollar was flat. Iron ore and gold were up but oil was weaker. So it's fair to say there's not much of a spark there for local investors.
For a comprehensive look at this morning’s business news, check today’s need2know. Here are this morning’s key market links:
- The SPI was 9 points higher at 4398
- The $A was trading flat at $US1.0451
- In the US, the S&P500 lost 0.13% to 1459.34
- In Europe, the FTSE100 lost 0.43% to 5868.16
- China iron ore added $US4.50 to $US109.60 a metric tonne
- Gold lost 60 US cents to $US1771.20 an ounce
- WTI crude oil lost $US1.23 to $US95.21 a barrel
- RJ/CRB commodities index lost 0.92% to 311.5
9.30am: Good morning folks. Welcome to the Markets Live blog for Wednesday.
Contributors: Thomas Hunter, Jens Meyer, Peter Litras
This blog is not intended as investment advice
BusinessDay with agencies