Market Wrap: Aus shares close down on Fed fears

Market Reports

The Australian share market closed 1.15 per cent down after Fed Chair Janet Yellen flagged a reduction in its QE program and with it the prospect of interest rate increases. Ongoing uncertainty in Ukraine also weighed on markets. 

The S&P/ASX 200 index closed 62 points down to finish at 5,294. 
 
The value of trades was $7.17 billion on volume of 1.14 billion shares at the close of trade. The top three stocks by value were Westpac Banking Corporation (ASX:WBC), BHP Billiton Limited (ASX:BHP) and Commonwealth Bank of Australia (ASX:CBA).

On the futures market the SPI is 14 points down.
 
Company news 
 
Shares in Brambles Limited (ASX:BXB) fell nearly two percent after it announced that it had on several previous occasions, including in the recent past, engaged in preliminary discussions about a possible transaction with Singaporean packaging manufacturer  Goodpack. However, these discussions did not progress and Brambles is not currently in active discussions with the company.
 
Goodpack told the Singapore Exchange on Wednesday that it “has been approached by several parties in connection with a possible transaction, which may or may not lead to an offer for the shares of the company”. Goodpack has a market capitalisation of SGD $1.26 billion on the Singapore Stock Exchange.
 
Brambles says it will continue to monitor the situation and inform shareholders of any further developments. Shares in Brambles fell further to closed 2 per cent down at $9.36. 
 
Shares in Myer Holdings Limited (ASX:MYR) have dropped over 5 per cent today after announcing its interim profit sunk despite improved sales as the company battled against higher rent, labour and facility costs. 
 
The department store retailer’s first half net profit dropped 8.1 per cent to $80.77 million in the same period total sales rose 0.3 per cent to $1.737 billion. 
 
CEO Bernie Brookes says the company has made good progress in executing its five-point plan but remains cautious about the trading environment due to pressure on discretionary income and uncertain consumer sentiment.
 
The report comes just one day after rival retailer David Jones Limited (ASX:DJS) reported a 3.8 per cent rise in its first half revenue but a 4.6 per cent fall in its net profit. 
 
Both companies have been in the centre of merger speculation since Myer approached David Jones for a potential $3 billion tie-up in October 2013. 
 
Myer has declared a fully-franked interim dividend of 9 cents per share, down from 10 cents for the previous corresponding half. Shares in Myer Holdings closed 5.26 per cent down at $2.52. 
 
Shares in Australand Property Group (ASX:ALZ) have risen nearly 1.38% against a negative market today after the company announced the appointment of an independent chairman after market close yesterday. Leading Independent Director Paul Isherwood was appointed to the role of Independent Chairman and has resigned as the chairman of the company’s audit committee.
 
Earlier yesterday, property developer Stockland (ASX:SGP) had acquired a strategic stake in the company. Shares in Australand Property are trading up 1.51 per cent. 
 
Activist investor and hedge fund VGI Partners has acquired a stake of up to 3 per cent in Echo Entertainment Group Limited (ASX:EGP) and is already pushing for the casino operator’s newly appointed CEO to restore value to what it calls the “cheapest casino stock in the developed world”.
 
VGI has a track record of acquiring substantial holdings in companies and then agitating for strategic change, as it did recently with auctioneers Sotheby’s. Shares in Echo Entertainment are trading down 0.41 per cent. 
 
The best and worst performers

All major sectors traded down today. The sector with the smallest losses was Real Estate Investment Trusts falling 2 points to close at 1,005. The worst performing sector was Materials, losing 202 points to close at 9,751 points.

The best performing stock in the S&P/ASX 200 was Aristocrat Leisure Limited (ASX:ALL), rising 4.05 per cent to close at $5.40. Shares in Trade Me Group (ASX:TME) and Cabcharge Australia Limited (ASX:CAB) also closed higher.
 
The worst performing stock today was yesterday’s best performer. Wotif.com Holdings Limited (ASX:WTF) dropped 11.33 per cent to close at $2.66. Shares in Alacer Gold Corp (ASX:AQG) and Resolute Mining Limited (ASX:RSG) also closed lower. 

Commodities

Gold is buying $US1,334  an ounce. Light crude is $0.67 up at $US100.37 a barrel.

The Australian dollar is buying $US0.9018.