Markets Live: Wesfarmers takes a hit

Here's how some of the blue chips performed today:

• BHP: +1.2%
• Rio: -0.9%
• ANZ: +0.7%
• CBA: +0.04%
• NAB: +0.5%
• Westpac: +0.3%
• Woolies: -1%
• Wesfarmers: -1.6%
• Telstra: -0.4%
• CSL: -3.4%
• AMP: +3.5%

And the biggest winners and losers among the top 200:

The stock market has closed slightly lower. The benchmark S&P/ASX200 index slipped 5 points, or 0.1 per cent, to 5152.4, while the broader All Ords lost 4.3 points, or 0.1 per cent, to 5136.7.

Among the sectors, gains in materials (up 0.5 per cent) and financials (0.3 per cent) were offset by losses in consumer staples (-1.2 per cent) and health (-2.1 per cent).

Aussie equities have followed overnight cues to trade lower, CMC Markets trader Betty Lam writes of today's session:

• Material based equities were the front runner, finding solid support on the back of stronger commodity prices.
• On the company reporting front, market heavyweight Wesfarmers reported a healthy net profit result, however after further assessment by investors, the stock was received with mixed trading.
• The big banks recovered from morning losses to operate in early green ranges for afternoon trading.
• The jumbled performance of sectors aided the ASX200 into plateau pattern and mild negative territory for the remainder of afternoon trading.

The drop in the Australian dollar is boosting the competitiveness of one of our biggest exports - bonds.

Japanese investors bought the majority of $580 million of Kangaroo notes issued by sovereign-backed lenders since July 30, people familiar with the transactions told Bloomberg, as the Australian dollar slid to the lowest this year against the yen.

One bidder bought all $700 million of the 2027 bond Australia auctioned July 31 as the local currency reached the weakest since 2010 versus the greenback.

"Japanese investors are now looking at the Australian bond market with greater interest because the Aussie is getting to attractive levels," said Anne Anderson, head of Asia-Pacific fixed income for UBS Global Asset Management, where she oversees $30 billion in assets. "The Japanese clearly have taken a lot of profit. That has slowed if not stopped."

Shares in cancer treatment outfit Sirtex are under pressure, down 2.5 per cent at $12.68 with investors unimpressed with its lateset earnings which show a bare rise in earnings a share to just 32.8 cents from 30.7 cents a year earlier.

Earnings are being held back as it ramps up production and marketing outlays as it prepares for results from a series of clinical trials which it hopes will lift future sales.

No decision on the dividend has been taken.

Some more on gold: billionaire hedge fund manager John Paulson, who told investors as recently as last month that they should own gold, cut his holdings in the metal by more than half as prices plunged into a bear market.

Paulson & Co, the largest investor in the SPDR Gold Trust, the biggest exchange-traded product for the metal, pared its stake to 10.2 million shares in the three months ended June 30 from 21.8 million at the end of the first quarter, according to a government filing yesterday.

The New York-based firm, which manages $US18 billion, cut its ownership for the first time since 2011 ‘‘due to a reduced need for hedging’’.

 

The JPMorgan Chase executives who supervised the traders at the center of the "London Whale" scandal are unlikely to face any charges over a trading debacle that cost the largest US bank more than $US6.2 billion, people familiar with the probe have told Reuters.

Federal prosecutors yesterday brought criminal charges against two former JPMorgan traders - Javier Martin-Artajo and Julien Grout - accusing the pair of deliberately understating losses on the trades on JPMorgan's books.

The complaints make only passing reference to their former bosses. Neither Ina Drew, the bank's former chief investment officer, nor Achilles Macris, a former top chief investment office executive, are mentioned by name in the complaints filed in New York.

The filings refer to Drew and Macris only by their titles and said they put pressure on their subordinates at one point to deal with the high degree of risk being taken on in the portfolio of derivatives trades that led to the losses.

There is no allegation in the complaints that either Drew or Macris did anything wrong or encouraged Martin-Artajo and Grout to conceal the losses, which first began to be publicly disclosed in May 2012.

Bruno Iksil, the trader most identified with the losses, is co-operating with federal prosecutors in an agreement which means he will not face charges. Iksil was known as "the London Whale" because of the size of derivatives trades he made.

Bank of Queensland's admission of its rate and fee errors doesn't seem to trouble investors or analysts too much.

BBY banking analyst Brett Le Mesurier says it is encouraging the Brisbane-based bank looked into the errors rather than let them fester.

"I think the point is that they've found it, whereas previous management created the problem, so I think it is a sign of an improvement in the business rather than a deterioration," Le Mesurier says.

The stocks are trading slightly higher (up 0.1 per cent) despite the overcharging revelations, as the bank also announced it is expecting its profit after tax for the year to August 31 to be at the top end of analysts' forecast range of $339 to $368 million, CIMB banking analyst John Buonaccorsi says.

The bank also added that accounting giant Ernst & Young had been appointed late last year to assess the internal review.