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Investors snapped up shares in gold miners, while the broader market saw solid gains.

The ASX is higher as investors digest updates from the Fed and Bank of Japan.

• Resources stocks storm ahead
• ANZ CEO justifies Oswal settlement
• We’re not inflation nutters: Lowe
• Stocks jump after Fed
• Gandel sells out of Charter Hall
• Vocus-Nextgen deal gets tick
• A ‘bondcano’ threatening blue chips

Welcome to the BusinessNow blog for Thursday, September 22. The market is higher as investors digest updates from the US Federal Reserve and Bank of Japan.

7.32pm:European stocks feel Fed uplift

Stocks in Europe moved higher in morning trade on Thursday, boosted by rising commodity prices and confirmation that the Federal Reserve plans to raise interest rates only gradually.

The Stoxx Europe 600 rose 0.8 per cent in morning trade, led by the energy and mining sectors. Brent crude oil was up 0.9 per cent at $US47.27 a barrel, while copper futures climbed 1.1 per cent to $US4,817 a ton and gold rose 0.4 per cent to $US1,336 an ounce, spurring gains in commodity-sensitive companies.

The moves followed mostly upbeat sessions in Asia and on Wall Street, after the Fed left short-term interest rates unchanged on Wednesday and reduced its forecasts for long-term growth and interest rates. Dow Jones.

7.01pm:How Radhika crushed ANZ’s will

It was Radhika Oswal’s turn in the witness stand last month that brought to a screaming halt one of Australia’s most extraordinary pieces of litigation, the trial of a $2.5 billion claim brought by the Indian businesswoman and her husband against the ANZ.

Over an afternoon and morning in mid-August, Radhika’s clear, confident voice dealt crushing blows to everyone who had crossed her since an arranged marriage at the age of 18: ANZ executives — especially former chief risk officer Chris Page — her in-laws and even her husband.

Her evidence showed how mistaken Page was to give her the dismissive tag “wifey” in an internal email — treating her as “nothing more than an appendage” of Pankaj Oswal, as her counsel, Garry Rich, SC, told the Victorian Supreme Court during the 11 weeks of hearings. The mistake helped cost the bank more than $200 million, paid to the Oswals to make them go away, plus tens of millions more in legal fees.

Misjudging Radhika as only a glamorous adjunct to her dowdy, business-minded husband was the second of ANZ’s mistakes. Read more.

6.28pm:Asian stocks close higher

Hong Kong and Shanghai stocks ended higher Thursday as investors cheered the Federal Reserve’s decision to leave interest rates on hold.

The Hang Seng Index in Hong Kong added 0.38 percent, or 89.90 points, to close at 23,759.80.

The benchmark Shanghai Composite Index advanced 0.54 percent, or 16.44 points, to 3,042.31 on turnover of 159.0 billion yuan ($23.9 billion).

The Shenzhen Composite Index, which tracks stocks on China’s second exchange, rose 0.63 percent, or 12.56 points, to 2,018.16 on turnover of 171.5 billion yuan. AFP

5.42pm:Gandel on track for narrow premium

Gretchen Friemann

John Gandel’s exit from Charter Hall Group is on course to price at a narrow premium to the floor price as investors struggle to digest close to 20 per cent of the property landlord and funds maanger the volume. Read more.

5.36pm:Dollar close to US1c stronger

The Australian dollar has gained almost one US cent after the US Federal Reserve decided against raising interest rates, while the new head of the Reserve Bank of Australia indicated there is little chance it will cut rates in the short term.

At 5pm (AEST) on Thursday, the local unit was trading at US76.58 cents, sharply higher from US75.65c on Wednesday.

The currency got an immediate boost in the early hours of Thursday when the US Federal Reserve left interest rates unchanged, as widely expected. It also failed to provide the market with any further certainty of a hike before the end of 2016.

“Although the statement acknowledged that the case for a rate hike “had strengthened”, this told the market no more than it already knew,” RBC’s head of G10 FX strategy Adam Cole said.

The probability of a rate hike by the end of the year has risen from around 50 per cent after the Fed’s last meeting to around 65 per cent, he said. RBA governor Philip Lowe fronted a regular parliamentary hearing later in the day, delivering an upbeat assessment of the economy. Read more.

4.51pm:King Salmon IPO price tipped at $1.12-$1.14

Bridget Carter

Float hopeful King Salmon is expected to price between $1.12 and $1.14 per share, according to sources.

A book build for the initial public offering of the New Zealand-based salmon producer is being held today ahead of a dual listing of the company on share markets both in Australia and across the Tasman. Read more.

4.49pm: Lowe’s no Yellen

Stephen Bartholomeusz

Our new Reserve Bank Governor, Philip Lowe, has provided a much more balanced explanation of the RBA’s role and its approach to monetary policy than his offshore peers have so far been prepared to offer.

While the US Federal Reserve, and the European Central Bank and the Bank of Japan have been prepared to acknowledge that their unconventional monetary policies might be having some modest adverse implications for financial institutions and asset markets, they are far more focused on trying to kindle inflation.

Lowe was happy to inform the House of Representatives economics committee that he and his team weren’t “inflation nutters,” which could imply that he thinks some of his offshore peers might warrant the description. Read more.

4.22pm:Stocks surge on resources gains

The Australian sharemarket has surged to its third straight positive close after investors welcomed central bank updates from the US and Japan and were unperturbed by mixed messages from new RBA Governor Philip Lowe.

At the closing bell, the benchmark S&P/ASX 200 index jumped 34.9 points, or 0.65 per cent, to 5,374.5, while the broader All Ordinaries index lifted 36.9 points, or 0.68 per cent, to 5,466.3.

The gains were driven by the materials sector as investors viewed a weakening US dollar and positive talk around US economic growth as a boon for commodities.

Gold miners were the favourites of the day, with Newcrest, Resolute Mining and Northern Star all gaining more than 6 per cent. Read more.

Daniel Palmer

4.10pm:Boral gets clearance for bricks JV

Boral has received clearance from US regulators to merge its operations in the region with Forterra Brick.

The combination, detailed last month, is set for completion by the end of November, with longtime Boral executive Paul Samples to take the reins as chief executive of the US joint venture.

“We are pleased that the US regulator has granted merger clearance for the North American bricks joint venture to proceed, recognising that the JV provides the opportunity to create a more efficient and better positioned business to compete in the broader cladding market through the cycle,” Boral chief executive Mike Kane said.

4.00pm:Telstra must think aggressively: Elop

Former Nokia CEO Stephen Elop has made his first public comments since joining Telstra’s management team earlier this year, declaring the telco is ready to weather the disruption the NBN is bringing to the industry.

Elop says Telstra must think aggressively to define its future

He told Telstra’s Vantage conference in Melbourne that the NBN rollout will see two to three billion dollars of profit disappear from the telco’s coffers in the next few years.

“Those are big numbers anywhere in the world,” he said.

“I look at that as a gift. It’s a gift of certainty and urgency; there’s no ambiguity Telstra must be thinking aggressively and moving forward aggressively to define its future.”

Mr Elop, who was appointed Telstra’s group executive for technology, innovation and strategy in April, said the loss of profits associated with the NBN also coincided with fresh payments flowing into the telco that it could use to serve its customers, and make ‘thoughtful investments.’
David Swan
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3.39pm:Why central bank tools aren’t working

Central banks have shown the will to hit their growth and inflation targets. But do they have the way?

That question is more pointed after the Bank of Japan yesterday announced two new central bank firsts. It now wants inflation not just to meet its 2 per cent target, but to overshoot it. And it will now target not just short-term interest rates, but long-term government bond yields.

The moves affirmed Governor Haruhiko Kuroda’s reputation for monetary experimentation, but also raised the more troubling question of why his previous innovations have fallen short.

Japan’s monetary travails matter to central banks since so many countries are coming to resemble Japan, with slow growth and too-low inflation — factors that make it difficult for an economy to tolerate interest rates much above zero.

WSJ
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3.23pm:China overseas investment at record high

China invested more money abroad last year than foreign firms piled into the country, data showed Thursday, a first for the world’s second largest economy as Beijing looks overseas as part of its drive to transform its economic growth model.

Overseas direct investment soared more than 18 per cent to an all-time high of over $145 billion last year, exceeding the $135.6 billion of foreign direct investment, according to the 2015 Statistical Bulletin of China’s Outward Foreign Direct Investment, published Thursday.
AFP
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3.02pm:Trump a threat to the Fed’s hike

From John Durie’s column today:

A Donald Trump victory in November’s US presidential election is one hurdle to what seems like a certain US Fed rate hike in December.

As expected, the Fed last night sat on its hands leaving short term rates on hold but being more hawkish in its commentary suggesting, assuming the data remains positive, that a 25 point rate hike in December is almost certain.

The latest opinion polls suggest Trump has closed the gap on Hillary Clinton and, albeit unlikely, an election victory would almost certainly upset financial markets on the simple theory of fear of the unknown.
Read more

2.36pm:Asian stocks rally as Fed holds

Asian stocks shot higher across the board Thursday, buoyed by the US Federal Reserve’s decision not to raise interest rates, as well as rising commodity prices.

The Hang Seng index in Hong Kong was up 1.6 per cent, Korea’s Kospi was 1.2 per cent higher, while the Shanghai Composite Index was up 0.8 per cent. The Nikkei Stock Average was closed in Japan for a public holiday.

2.23pm:Defensive stocks under pressure

The concept of ‘defensive stocks’ is being tipped on its head in the Australian market, with weak earnings growth seeing crowd-favourite companies come under renewed pressure.

“Markets are in a transition phase where the ‘old’ is being questioned at a time when conviction in the ‘new’ is not high,” Macquarie analysts said today.

“This is creating volatility around traditional pockets of strength which have dominated relative performance on the back of a falling bond yield and the pursuit of earnings growth at (very nearly) any cost.”

The market will remain in a “very unforgiving mood”, according to Macquarie, until what it calls “durable” themes emerge.

“Much of the market upside in recent years has been driven by a bull market in defensive stocks — either yield or growth.

“The potential for higher rates raises questions around what is defensive, as do absolute valuations.”

Macquarie’s picks:

“Our picks for stocks that have been de-rated despite positive revisions are BlueScope Steel and Sydney Airport.

“Among the stocks that have suffered downgrades but greater price declines, we like Commonwealth Bank and Telstra.

“Stocks that have suffered earnings declines but seen PEs expand are CSL and News Corp.”

News Corporation is the publisher of The Australian.

2.05pm:Star reveals tower finalists

The Star has revealed the three architects that will battle to win the right to develop its proposed $500 million Sydney tower, which is on track to open before James Packer’s new ­casino in the harbour city.

Three architects are in the running to develop the $500m Sydney tower.

The casino operator said today that Grimshaw Architects, Francis-Jones Morehen Thorp and BVN had been selected to present designs for the proposed Sydney development.

“We’re delighted to have such highly-regarded, award-winning architectural firms involved in the competitive design process,” The Star Entertainment’s chief executive, Matt Bekier, said today.
Sarah-Jane Tasker
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1.35pm:Lowe’s housing market concerns

Reserve Bank Governor Philip Lowe has expressed “worry” about the ability of young people to get a foothold in the housing market, Daniel Palmer writes.

The stunning rise in Australian house prices over the past two decades has caused many millennials to give up on the prospect of buying a house, with Dr Lowe saying the issue personally affected him.

“As a father of three children I worry … because people are paying so much for housing,” he told the House of Representatives Standing Committee on Economics.

The newly appointed governor, who assumed the role on Sunday follow the retirement of Glenn Stevens, said the key issues behind high house prices relative to incomes were a lack of supply and transportation networks that failed to encourage purchases in outer suburbs.

1.15pm:Resources stocks storm ahead

Resources stocks are storming ahead today after the Fed’s comments tugged the US dollar lower and, in turn, boosted the Aussie dollar and commodity prices.

Gold miners have seen the biggest gains today.

At 12:50pm AEST the S&P/ASX 200 was 0.7 per cent higher at 5376.1 points, with the materials sector leading the way with a 2.6 per cent rise.

Gold miners were the biggest winners, with the price of the precious metal jumping as much as 2 per cent following the Fed news.

Miners Resolute, Newcrest, Northern Star, Evolution and Regis Resources all gained more than 5 per cent, while Fortescue jumped 5.8 per cent and Rio Tinto gained 3.3 per cent. BHP Billiton, the world’s biggest miner, rose 2.8 per cent and Woodside Petroleum, the nation’s biggest listed oil and gas stock gained 2.2 per cent.

The big four banks lifted between 0.1 per cent and 0.6 per cent, while Telstra and CSL each picked up 0.8 per cent, Macquarie fell 1 per cent and both Woolies and Wesfarmers slipped 0.1 per cent.

For more on the Fed’s latest update, read Stephen Bartholomeusz’s analysis.

1.05pm:Westpac tries to regain community trust

Westpac will try and regain lost community trust by removing all product-related incentives for the bank’s 2000 tellers from next month.

Chief executive Brian Hartzer made the commitment in a lunch time speech today to the Australia Israel Chamber of Commerce in Melbourne.

Mr Hartzer acknowledged that banks had a “trust gap” and they had to bridge it.

“From next month, we’re planning to remove all product-related incentives across our 2000 tellers in the Westpac branch network,” he said.

“Rather, their incentives will be based entirely on customer feedback about the quality of service they received in the branch.”
Richard Gluyas
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12.45pm:Key points from Philip Lowe’s speech

Here are the most important things Philip Lowe said today.

When asked whether Australia was at risk of running out of policy options, the new Reserve Bank Governor stated “not at all”. And with interest rates in negative territory in several key areas, including Japan and the eurozone, plenty can see the buffer Philip Lowe is talking about in Australia, which has its official cash rate set at 1.5 per cent.

RBA Governor Philip Lowe says Australia is not at risk of running out of policy options.

In his first speech as RBA governor Dr Lowe said it is “possible” that interest rates could keep falling in Australia but it will depend on factors such as inflation, employment, housing and global influences. Interestingly, he also added that it was “not particularly useful” to keep on cutting interest rates in the hope that it will eventually work to lift growth.

Here’s a quick run-through of the speech’s key points, as seen by CommSec chief economist Craig James:

Economic assessment

“Overall, the economy is adjusting reasonably well to the unwinding of the biggest mining investment boom in more than a century. This is a significant achievement. We are managing this adjustment partly because of the flexibility of the exchange rate and the flexibility of wages and through the support provided by monetary policy.”

Income growth

“The story on income growth has been less positive, with growth in nominal GDP being disappointing.”

China faces a “difficult economic transition”

“Overall, the latest available data suggest that there has not been a major interruption to growth, although this is partly because the economy is being supported by fiscal policy, including expenditure on infrastructure.”

Global monetary policy

“The monetary expansion elsewhere and the low rates on offer overseas have meant that foreign investors have found Australian assets, with their relatively higher returns, attractive. In this way, what is happening elsewhere affects us here in Australia.”

Housing

“Overall, then, the situation is somewhat more comfortable than it was a year ago, although we continue to watch things carefully.”

Mining

“While mining investment still has some way to fall, our estimate is that around three-quarters of the total decline is now behind us.”

12.30pm:ANZ CEO justifies Oswal settlement

The “unusual and complex circumstances” of a $2.5bn claim against the ANZ by Indian business couple Pankaj and Radhika Oswal justified settling the case, bank chief executive Shayne Elliott has told staff.

ANZ has reached a settlement in the dispute with Pankaj and Radhika Oswal.

ANZ this morning announced it had reached a confidential settlement of the Victorian Supreme Court proceedings with the couple.

It did not disclose the total amount it will pay the couple, but it’s believed to be more than $200m. The bank said it would take a $145m hit on the case this year, additional to its previous provisions.

In an all-staff email sent this morning, obtained by The Australian, Mr Elliott said it was “not normal that we settle legal cases in situations like those involving the Oswals”.

Ben Butler
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12.15pm:Fonterra sees sharp profit rise

New Zealand dairy co-operative Fonterra has reported a sharp rise in earnings despite its farmer-suppliers enduring one of the most tumultuous years in recent memory, Daniel Palmer writes.

For the year to July 31, the world’s largest dairy group said net profit surged 65 per cent to $NZ834 million ($807.1m) despite revenues sliding 9 per cent to $NZ17.2 billion.

The group delivered earnings per share of NZ51c, in line with its guidance for 45c to 55c a share.

Fonterra said the results were symbolic of “a stronger business despite ongoing challenges in global dairy markets”.

“We continued with the significant and necessary changes we began in the business over three years ago to support our strategy and its priorities, and worked hard to return every possible cent of value back to our farmers,” chairman John Wilson said.

Read more

11.45am:Dollar lifts on RBA comments

The Aussie dollar welcomed new RBA governor Philip Lowe with a quick pop to a fresh two-week high as Dr Lowe reaffirmed the Bank’s 2-3 per cent inflation target.

The local currency ticked up to US76.50c during the first minutes of the new governor’s speech to the House of Representatives Standing Committee on Economics, in which he assured the audience the RBA is not full of “inflation nutters”.

It was the highest the Australian dollar has been since September 9, but by 11:30am AEST it had drifted back to US76.33c.

The Federal Reserve opted to leave interest rates on hold overnight, which pushed the US dollar lower and in turn boosted the Aussie dollar and commodity prices. The Fed continues to hint at an upcoming rate hike — the market is now expecting that to happen in December.

11.30am:Chinese go online to buy Aussie homes

China’s Fosun Group has set up an online shopping-style platform to sell overseas properties, including Australian homes, to the Chinese middle class seeking a safe haven outside of the country to protect their wealth.

The Estarhome platform has sold 50 Australian homes for about $30m since March.

Maggie Lu YueYang reports that Estarhome.com, the new online-to-offline service, is providing another channel, apart from ­traditional agents, for Chinese ­investors to park their money in Australian properties that are seen as safe, and smart, ­investments. Chinese buyers already account for the vast bulk of foreign investment in Australia’s property market, overwhelmingly in new apartments. The latest report from the Foreign Investment Review Board shows about two-thirds of the $61 billion in applications during the last financial year came from Chinese nationals.

Shanghai-based Fosun has been relatively quiet since making its foray into the property market last year, buying an office tower in North Sydney for $116.5 million in partnership with Propertylink, and then striking a deal with EG Funds to build 1000 new apartments in Sydney and Brisbane.
Read more

10.49am:We’re not inflation nutters: RBA’s Lowe

Newly appointed Reserve Bank Governor Philip Lowe has insisted the central bank is not full of “inflation nutters” as he delivered his first speech since taking over the role vacated by Glenn Stevens on Sunday.

RBA Governor Philip Lowe says the central bank isn’t full of inflation nutters. (AAP Image/Paul Miller)

In his opening remarks to the House of Representatives Standing Committee on Economics, Dr Lowe reaffirmed the group’s commitment to the medium-term inflation target of 2-3 per cent, but hinted the RBA would not be concerned by a period of undershooting the target.

“It is worth emphasising that ever since the adoption of the current framework, the Reserve Bank has been a proponent of what is known as flexible inflation targeting,” he said.
Daniel Palmer
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10.25am:Stocks jump after Fed

The Australian sharemarket has jumped in early deals as central bank updates from the US and Japan were well-received on Wall Street.

At the 10.15am (AEST) official market open, the benchmark S&P/ASX 200 index surged 41.4 points, or 0.78 per cent, to 5,381, while the broader All Ordinaries index advanced 42.8 points, or 0.79 per cent, to 5,472.2.

The gains at home were largely driven by resources stocks after crude and iron ore prices gained ground overnight.

BHP Billiton leapt 2.1 per cent to $21.16, Rio Tinto climbed 1.8 per cent to $48.49 and Fortescue rebounded 2 per cent to $4.99.

Meanwhile, gold miners surged in morning trade after the gold price jumped 2 per cent overnight.

At 11.10am, Newcrest Mining had climbed 6.97 per cent to $22.85, while Evolution Mining was 6.46 per cent higher at $2.55. Saracen Minerals was up 11.76 per cent to $1.52, while Resolute Mining was 8.92 per cent higher at $2.32.

Elsewhere, Solomon Lew’s Premier Investments slumped 5 per cent as profit numbers fell short of forecasts.

Daniel Palmer
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10.15am: Gandel sells out of Charter Hall

Retail property billionaire John Gandel has sold his near $500 million stake in the Charter Hall Group and its listed retail trust as he focuses his attention on rival Vicinity Centres and his holding in Melbourne’s Chadstone Shopping Centre.

In two shock block trades revealed this morning, Mr Gandel is looking to pull $488 million worth of securities from the Charter Hall property empire.

Both sales are fully underwritten by Macquarie Capital and the shares are being sold to third-party investors.

The Gandel Group said it had entered into a $396m block trade agreement to sell 79.17 million Charter Hall securities, which amounts to 19.18 per cent of the register.

The $396m deal has been set at a floor price of $5 per security and investors have been asked to bid up in 2c increments. The price is a 7.1 per cent discount to the last close on the stock.

Gandel has also struck a deal to sell its 5.65 per cent interest in Charter Hall Retail REIT. Macquarie has launched a $92m block trade in the trust, with the deal set at a fixed price of $4.02 per security, marking a 3.5 per cent discount to the last close.

Ben Wilmot, Gretchen Friemann
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10.10am:Vocus-Nextgen deal gets tick from ACCC

Vocus Communications’ $807 million takeover of Nextgen Networks has received the green light from the competition watchdog, with the deal likely bringing an end to the rampant consolidation seen in the telecommunications sector over the past few years.

In a statement this morning, the Australian Competition and Consumer Commission said it would not stand in the way of the transaction given the services provided by Nextgen and Vocus scarcely overlap.

The approval comes at an intriguing juncture, with analysts suddenly jumpy about the long-term impact of the NBN on the margins of the key broadband players and, more specifically, those of TPG and Vocus.
Daniel Palmer

9.55am:Dollar pushes near two-week high

The Aussie dollar has pushed to an almost two-week high following this morning’s Fed announcement.

At 9:50am AEST the local currency was buying US76.35c, up from 75.58c at that time yesterday.

The Federal Reserve kept rates on hold overnight but continues to feed expectations of at least one hike this year.

“The committee judges that the case for an increase in the federal funds rate has strengthened,” the statement said.

9.42am:Investors to step back into market

Australian investors look set to head back into the market after spending weeks sitting on the sidelines in anticipation of some clarity from US and Japanese central banks.

The US Fed left rates on hold but signalled a hike before the end of the year. Getty Images

Despite Fed vice chairman Stanley Fischer in January saying four rate hikes in 2016 would be “in the ballpark”, here we are in September and we haven’t seen a single one. As has become customary, hints were dropped that a hike is on the way — December looks most likely.

Investors breathed a sigh of relief and got stuck back into equities, with the S&P 500 rallying following the announcement and closing 1.1 per cent higher for the day.

That positivity looks set to flow into the local market this morning, with the SPI200 pointing to a 0.6 per cent rise, while fair value suggests a 0.7 per cent rally could be more likely.

Yesterday saw the index lift 0.6 per cent to close at 5339.5 points, which means the ASX is now 0.8 per cent higher for the week and looking unlikely to notch up its sixth weekly loss in a row.

9.31am:Soul Patts profit surges

Investment firm Washington H. Soul Pattinson has seen its profit surge by almost 80 per cent due to a marked reduction in impairments for the full year.

Rob Millner, chairman of Washington H Soul Pattinson.

In the 12 months to July 31, WHIP booked a 79.3 per cent jump in earnings to 149.4 million.

The more closely-watched ‘regular profit’ reading — which strips out the impact of one-off items — lifted 9.1 per cent to $162.4m, with the group pointing to strong contributions from its investments in TPG Telecom, Brickworks and Australian Pharmaceutical Industries.

“The past year has been a good demonstration of the success of our investment style, highlighting the mix and quality of WHSP’s investments,” WHSP chairman Rob Millner said.
Daniel Palmer
More to come

9.13am:Brickworks lays out a tiny profit rise

Brickworks has reported a flat profit in fiscal 2016 owing to impairments at its under-pressure Western Australia operations, writes Daniel Palmer.

Brickworks says the outlook for 2017 remains positive.

Australia’s largest manufacturer of bricks said its net profit inched up 0.1 per cent to $78.2 million in the year to July 31, despite a robust 3.8 per cent lift in revenue to $751m.

The result was adversely affected by $68.9m worth of impairments, with $47.3m linked to a writedown of its Austral Bricks Western Australia unit.

Brickworks managing director Lindsay Partridge said conditions for its core building products division looked promising for fiscal 2017 due to an ongoing housing boom up and down the east coast.
Read more

8.58am:A ‘bondcano’ threatening blue chips

Australian stocks trading at a premium are looking vulnerable as the bond market “erupts” from recent lows, according to Credit Suisse, which names Transurban, Sydney Airport, Healthscope and Crown as among those on shaky ground.

“Our livelihoods have been established on the side of the ‘bondcano’.”

Equity strategist Hasan Tevfik used the term “bondcano” to describe the volcano-like landscape of the Australian marketplace and flagged a tipping point where forces pushing bond yields lower for as long as 20 years have begun to reverse.

Credit Suisse stands at odds with those who regard the recent rise in fixed-interest yields as a “blip in a longer-term downward trend” — it sees a 20-basis-point rise from Australia’s 10-year government bond yield in two weeks as signalling a dynamic shift in the scenery.

Read more

8.32am:ANZ settles Oswal case

Flamboyant Indian business couple Pankaj and Radhika Oswal have settled their multi-billion dollar lawsuit with the ANZ, the bank has told the stock exchange, Ben Butler writes.

ANZ says it will take an additional $145m hit this year.

ANZ said terms of the deal were confidential but would result in the bank taking an additional $145m hit to its bottom line this year.

The Oswals had been suing the bank and receivers PPB over ANZ’s seizure and sale of their majority stake in Burrup Fertilisers in 2010 as part of a dispute over $1bn the couple owed to the bank.
Read more

7.15am:Australian stocks set to open higher

The Australian share market looks set to open higher, mirroring a rally on Wall Street after the US Federal Reserve kept interest rates unchanged.

At 6.55am (AEST), the share price index was up 32 points at 5,355.

Locally, in economic news, new Reserve Bank of Australia governor Philip Lowe will front a House of Representatives committee later.

In equities news, Premier Investments, Brickworks and Washington H. Soul Pattinson report full year results, while Suncorp Group will hold its annual general meeting.

In Australia, the market yesterday closed higher, led by the banking sector, after Japan’s central bank chose to keep its rates on hold.

The benchmark S & P/ASX 200 index ended up 36 points, or 0.68 per cent, at 5,339.6 points.

The broader All Ordinaries index closed 32.1 points, or 0.59 per cent higher, at 5,429.4 points.

AAP

7.10am:Iron ore ticks higher

The iron ore price has edged a whisker higher, managing not to slip below the $US55 a tonne threshold for another day as it gradually eases back from last month’s peak.

Iron ore added 0.2 per cent to $US55.40 a tonne overnight, according to The Steel Index, from $US55.30 the previous day.

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7.00am:Dollar jumps as US Fed holds

The Australian dollar has rallied against the greenback as the US dollar slipped after the Federal Reserve kept interest rates unchanged and downgraded its rate projections.

At 6.40am (AEST), the local unit was trading at US76.28 cents, sharply higher from US75.65 yesterday.

AAP

6.50am:Wall St rallies as Fed holds

US stocks climbed, sending the Nasdaq Composite to a record, while the dollar weakened and government bond yields slipped after the Federal Reserve left interest rates unchanged.

The Dow Jones Industrial Average climbed 0.9 per cent to 18293.70 and the S & P 500 gained 1.1 per cent. The Nasdaq Composite rose 1 per cent to 5295.18, a closing record.

Earlier, European stocks also rose after Japan’s central bank said it would keep trying to boost inflation.

Read more

Dow Jones

6.40am: US Fed holds, eyes December

The US Federal Reserve has kept official rates on hold and hinted at a hike by the end of the year, putting a rocket under both US stocks and the Australian dollar, writes Elizabeth Redman

Wall Street bounced after the decision was released, despite some choppy trade the Dow managed to rally to close 0.9 per cent higher.

The Australian dollar was buying US75.85c one minute before the statement, then jumped to US76.24c after the decision. Despite a rocky few hours, the Aussie was trading at US76.22c at 6.10am (AEST).

“The case for an increase in the federal funds rate has strengthened,” the central bank said in its post-meeting statement, adding that it preferred to wait for more evidence of progress towards its objectives before making its next move.

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