The struggling US investment bank, Lehman Bros has brought forward its third quarter financial statement by a week, and has promised also to detail new capital initiatives after its shares sank 45% on Wall Street overnight.
Lehman was due to report after trading next Thursday, US time, or early Friday morning, September 19, Sydney time.
That will now happen early Wednesday morning US time, or around 9.30 pm tonight, our time.
The shares fell $US6.36 to $US7.79 overnight after talks with Korea Development Bank ended. The stock has dropped 88% so far this year.
The decision to advance the report and to detail the new moves to obtain new investors and fresh capital came after talks with the Korea Development bank ended over a 25% stake.
It was originally talks over a 50% stake, but Lehman management wanted more than the KDB was prepared to pay, and then South Korean financial regulators went public with their opposition to a deal.
The news sent Wall Street down sharply, and the Standard & Poor’s 500 index had its biggest fall of 2008: down 3.4% as oil, commodity, metals processing and a wide range of financial shares tumbled.
Lehman might have been the catalyst, but the fall was across the board and few stocks were spared some sort of pressure.
The drop in oil, copper and gold, allied to the Lehman news, will batter markets in this part of the world today.
Asia-Pacific stocks dropped on yesterday, led by falls in Australia, Japan, Hong Kong which quickly reversed the solid Monday gains on the back of the bailing out of Fannie Mae and Freddie Mac.
European markets eased, as did the US which fell more than 2%, undoing its big Monday rally as well.Gold slumped well under $US800 an ounce, oil fell past $US100 a barrel, but bounced back over and copper was also weak.
It will be another rough day here as a result with the futures market suggesting a 160 point, or 3% fall at the opening.
Macquarie Group dropped 7.3% in Australia as the shorts recovered their confidence after being forced to short cover Monday, which drive the price up 10%.
The MSCI Asia Pacific Index fell 2.1% yesterday after Monday’s 3.9% jump, so some of Monday’s gains are still there. That will change today.
Investors treated the gain on Monday as a one-day wonder with the bailout of Fannie and Freddie recognition that it was inevitable, but not a vital part of any plan to re-balance the credit markets and end the crunch.
The Australian market was off 1.6%, with gold and other resource stocks leading the way down.
In Tokyo, the Nikkei lost 1.8%; Taiwan’s market fell 3.5%, the region’s biggest fall and all other regional benchmark indexes declined apart from China and New Zealand, which were little changed. The Korean and Thai markets were lower as well.
The Australian stock market fell for the 6th day out of seven yesterday with the S&P/ASX200 index down 87.4 points, or 1.72%, to 4980.1 and the All Ordinaries off 84.4 points, or 1.65%, to 5041.9.
BHP Billiton dropped $1.55, or 4.12%, to $36.05, Rio Tinto lost $2.75, or 2.49%, to $107.50 and Fortescue Metals fell 60 cents or 8.45% to $6.50.
In the banks, the NAB added 39 cents to $25.49; the Commonwealth Bank lost $1.05 to $43.82 and Westpac shed 38 cents to $24.20.
ANZ fell 19 cents to $17.41 ahead of a shake-up that is expected to result in big job losses.
The bank says it plans to simplify its business model and reorganise its operations into three regions as part of efforts to rekindle profitability at the country’s fourth-biggest bank.
Bureaucracy within the bank will be a target of the overhaul, with an unspecified number of positions to go.
"Our new structure simplifies ANZ by organising ourselves around our customers and reducing the management layers between me and the staff who serve our customers from up to 12 to around seven,” ANZ chief executive Mike Smith said in a statement to the ASX yesterday afternoon.
The Melbourne-based bank employs about 34,000 staff, worldwide.
The bank says it will reorganise around three regions – Australia, New Zealand and the Asia Pacific – and its global institutional client business.
