The Australian share market has closed lower, after some bad news about the largest bank in the US, JPMorgan Chase, spooked investors.
On Friday, the benchmark S&P/ASX200 index was down 10.5 points, or 0.24 per cent, at 4,265.1 points, while the broader All Ordinaries index fell 11.1 points, or 0.25 per cent, to 4,342.7 points.
On the ASX 24, the June share price index futures contract was 16 points lower at 4,285 points, with 31,050 contracts traded.
JPMorgan Chase said on Thursday (US time) that it had lost $US2 billion ($A1.99 billion) in the past six weeks in the trading of complex financial instruments known as derivatives in a “flawed” hedging operation.
The company’s stock fell almost seven per cent in after-hours trading in the US, following announcement of the loss.
City Index chief market analyst Peter Esho said the news about JPMorgan had made Australian investors nervous.
“Nobody wants to take any unnecessary brave positions into the weekend without really knowing what’s going to happen in the US tonight, to the financials (bank stocks).
“Also, the news flow out of Europe probably has more downside risk.”
Politicians in debt-ridden Greece have so far failed to form a government after elections on the weekend undermined support for the ruling coalition and placed government austerity measures designed to control surging debt in jeopardy.
On the local bourse in the resources sector, global miner BHP Billiton retreated 25 cents to $34.37, and Rio Tinto dumped 87 cents at $61.07.
Among the major banks, ANZ was 11 cents lower at $22.04 as it became the last of the big four banks to pass on some of the Reserve Bank of Australia’s interest rate cut.
National Australia Bank was two cents weaker at $24.55, Westpac shed 18 cents at $22.72, and Commonwealth bank dropped 10 cents to $51.80.
Among other stocks, law firm Slater & Gordon was three cents lighter at $1.75 after it said it would book a $10 million writedown after the High Court decided not to grant its client leave to appeal a full Federal Court decision in the Vioxx class action.
Trans-Tasman casino operator SkyCity Entertainment Group sagged 12 cents to $2.90 after it downgraded its profit expectations following weaker trading conditions, especially in Adelaide.
Garage doors and construction products supplier Alesco eased one cent to $2.06 after it again urged its shareholders to take no action on the $188 million takeover offer from Dulux Group. Dulux was one cent lower at $3.03.
Telstra shed four cents to $3.60 after the telco appointed a senior executive from within its ranks as chairman of pay-tv provider Foxtel.
The price of gold in Sydney was $US1,581.75 per fine ounce, down $US12.29 on Thursday’s close of $US1,594.04.
On Wall Street On Thursday, the Dow Jones Industrial Average rose 19.98 points, or 0.16 per cent, to 12,855.04 points amid hopes that Greece’s moderate socialists might be able to form a government and avoid a new euro zone debt crisis.
