Markets live: Multi-billion-dollar US fund Blue Owl’s liquidity squeeze could ‘blow up’

Australian exporters to the US could be set for a windfall if some of the Trump administration’s trade tariffs are ruled unlawful.

Modelling of a major consulting firm shows Australian exporters would be owed more than $1.4 billion in refunds.

Read more on our political reporter Alexander Lewis‘s reporting.

Australia’s unemployment rate remained at 4.1% in January, the same as in December, in seasonally adjusted terms.

The data reveals workers landed tens of thousands of full-time jobs, putting pressure on the Reserve Bank to deliver a follow-up interest rate hike.

It comes as the AI revolution threatens to change work as we know it.

Here is the latest from business correspondent David Taylor: 

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The business team is watching developments around Wall Street private equity firm Blue Owl.

Its share price fell sharply overnight following a move to restrict investors redemptions.

Put simply, Blue Owl, worth billions of dollars, could not meet investor demands for cash.

The Montgomery Fund’s Roger Mongtomery has this analysis:

“Blue Owl’s move to permanently curb quarterly redemptions in OBDC II—shifting instead to opportunistic capital returns via asset sales and repayments—is the reason I have been telling investors loan book duration is one of the risks they have to understand.”

Again, translating this, Montgomery is saying that rather than Blue Owl distributing investor returns as normal, it’s been forced to sell assets to cover investors’ demands for cash back.

“I’ve been watching the steady erosion in public market proxies for private credit firms, including ETFs holding these firms, since late last year.

“This latest episode with Blue Owl adds to the unease.”

Again, Mr Montgomery is suggesting here that Blue Owl does not appear to be a catalyst for a liquidity crisis, but it adds to existing concerns about Wall Street’s short-term cash problems in meeting investor needs.

“The assets are not held on the balance sheets of systemically important banks, so I still don’t see the ingredients for a full-blown Lehman-style crisis in private credit but it’s a tail-risk —as is geo-politics.”

Telix Pharmaceuticals‘s shares have soared 14.2% after posting a 56% increase in full-year revenue to $US803.8 million.

CEO Dr Christian Behrenbruch said the revenue reflected the company’s “confidence in sustaining the
momentum of our core cash-generative business”.

“We are reinvesting earnings to prioritise the acceleration of our best-in-class therapeutic pipeline, which now includes three pivotal stage trials in prostate, kidney and brain cancer.

“We also intend to continue to expand the Precision Medicine growth opportunity through label expansion studies and new product launches.

“In 2026, we are focused on [the] delivery of these near-term priorities to further strengthen the foundations for long-term revenue and earnings growth.”

Six sectors are lower, along with the ASX 200.

The technology and consumer staples sectors are the worst performers, down 2.8% and 1.5%, respectively.

Meanwhile, utilities is the best performing sector gaining 0.6% and 0.9% for the past five days.

Stocks in Asia have fallen with Japan’s Nikkei dropping 1% and Hong Kong’s Hang Seng slipping 0.3% on its return from the Lunar New Year break, as of 1pm AEDT.

As we reported earlier, asset manager Blue Owl has been forced to halt investor redemptions.

For context, the firm is similar in size to Australia’s largest investment bank, Macquarie Group.

The firm told investors in Blue Owl Capital Corp II, known as OBDC II, that it will no longer be able to redeem shares on a quarterly basis.

Instead, the fund will return capital through periodic distributions funded by loan repayments, asset sales or other transactions.

Henry Jennings is a senior market analyst with Marcus Today.

He’s told the ABC that Blue Owl’s liquidity squeeze has the potential to “blow up”.

“Blue Owl Capital in the US, a large private equity fund manager, has frozen redemptions on one of its funds,” he said.

“Private equity investment is not liquid.

“It is not valued every day, so given current sentiment in AI and software stocks and the debt associated with it, valuations are getting harder to justify.

“This has potential to blow up as valuations for specific assets infect sentiment elsewhere.”

Hi KA,

Thank you for your comment.

Guzman y Gomez (GYG) has indeed reported its first-half profit, which was better than expected.

However, sluggish US sales in a challenging consumer environment sent its shares plunging 16% to a record low this morning.

The company expects US losses to increase slightly in the year to June, compared with an $13.2 million loss in fiscal 2025.

“The company is executing well, but not as fast as the market is expecting,” Citi analysts said.

“It’s hard to see what’s new in this result that would make investors chase the stock higher, especially given the valuation.”

GYG’s Australia segment was the biggest contributor to its sales during the half, reporting first-half network sales of $673.6 million, 17.5% higher than last year, and forecast full-year profit margins of up to 6.2%, compared to 5.7% last year.

The fast-food chain operator reported net profit after tax of $10.6 million for the six months to December 31, higher than the Visible Alpha consensus of $9.2 million and last year’s $7.3 million.

Group network sales jumped 18% to $681.8 million, although that missed the Visible Alpha consensus of $687.3 million.

The company has declared an interim dividend of 7.4 cents per share.

I hope this helps clear “some air” for you.

Reporting with Reuters

Shares in Wall Street asset manager Blue Owl have fallen 6%.

The firm told investors in Blue Owl Capital Corp II, known as OBDC II, that it will no longer be able to redeem shares on a quarterly basis.

Instead, the fund will return capital through periodic distributions funded by loan repayments, asset sales or other transactions.

The firm said it had sold about $1.4 billion in direct-lending investments across three funds to provide investors with promised liquidity.

The move highlights the risks confronting retail investors entering the fast-growing private credit market.

Though investors are generally allowed to redeem a portion of their capital each quarter, payouts can be curtailed if withdrawal requests exceed set limits.

The ABC’s business team will keep following this story.

Reporting with Bloomberg

WTI Crude Oil is trading higher, up 2.4%, to $US66.49,  poised to close at its highest level in nearly seven months amid intensifying geopolitical risks in the Middle East, according to IG market analyst Tony Sycamore.

The advance builds on Wednesday’s sharp 4% gain, fuelled by ongoing concerns over a possible US military strike on Iran after nuclear talks in Geneva stalled and US carrier strike groups were repositioned closer to the region, Mr Sycamore adds.

“The build-up in US military assets does have a dual purpose of offering the option of a strike on Iranian military targets while also building pressure on Iran to agree to terms around its nuclear program the US will find more acceptable,” he said.

“As we noted yesterday, the current game of diplomatic ‘cat and mouse’ may extend over the next few weeks before a resolution is found either of a diplomatic or military nature.

“Technically, crude oil is trading towards the top of the $US55–$US66 trading range that has defined the past six months.

“A sustained break above the top of the range, say, would open the way for further gains towards $US70.

“While signs of de-escalation will likely see a retracement back towards $US61.”

After a brief appearance from the Deli Entertainment manager this morning, the ACCC v Coles matter has finished early for the day, ending our coverage for this week.

The trial will not return again until next Wednesday where we’ll hear closing arguments from both sides.

If you haven’t been following each day, here is a wrap of what’s at stake for both parties depending on who wins:

Wesfarmers chief executive Rob Scott says the recent inflation numbers and the February interest rate rise has made customers more cautious, particularly those on lower incomes.

Here is the interview with business presenter Alicia Barry:

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Austal‘s shares have surged after the company announced a $4 billion contract to build eight Landing Craft Heavy vessels for Australia’s Department of Defence.

The vessels, all expected to be delivered to the Commonwealth in 2038, will be constructed in Henderson, Western Australia, according to Austal.

CEO Paddy Gregg said the contract generated a record order
book for Austal, providing “a long-term demand signal” for its supply chain and “the
incentive to invest in uplifting its capability”.

“Constructing the Landing Craft Heavy vessels at Henderson will create and develop
thousands of new, skilled jobs in Western Australia and provide further opportunities for the
local defence industry supply chain,” he said.

“It also provides earnings and employment stability for
the next 12 years.”

The company’s shares are trading at $6.3 per share, giving it a market cap of $2.51 billion.

To kick off day five in true Friday spirit the Coles trial has decided to crack out the cheese platter and do some light entertaining.

Essential to that platter is a Coles-own brand quince paste, and the manager in charge of setting the price for it, Ed McCutchan, the manager of deli entertainment.

The proceedings have followed much the same format as previous days with painstaking exchanges about why prices were lifted to much higher prices for short periods of time before being dropped to a “Down Down” price.

Mr McCutchan denied the pricing structure was purely to make the most profit for Coles, saying it was also about value for money for the customer.

There was a tussle about why the paste was sold for $4.50 for four weeks before being placed on a Down Down discount for $3.15 and sold at that price for more than 270 days.

The previous Down Down price just a month before the price increase to $4.50 was $3.00, meaning customers were paying 15 cents more on the updated Down Down price.

Coles is now giving more of its defence to the court.

The Australian market has been trading for about an hour and a half.

Here are the best and worst-performing movers so far.

Among the best-performing individual stocks:

• Deep Yellow Ltd, +5.5%
• QBE Insurance Group, +5.4%
• Austal, +5.4%
• Telix Pharmaceuticals, +5.3%
• Perseus Mining, +4.1%

Among the worst-performing stocks were:

• Guzman Y Gomez, -10.4%
• EBOS Group, -5.6%
• Siteminder Ltd, -5.3%
• WiseTech Global, -5%
• Aristocrat Leisure, -4.9%

Japan’s core consumer prices rose 2% in January from a year earlier, government data showed on Friday.

The core consumer price index, which includes oil products but excludes fresh food prices, compared with economists’ median estimate for a 2% annual gain.

Stripping away the effect of fresh food and energy, consumer prices rose 2.6% in January from a year ago.

– Reuters

We’re about to head into day five of the ACCC v Coles case in the Federal Court.

We’re expecting one witness from Coles today.

Yesterday we heard from former manager Paul Carroll who was questioned over the pricing of wet dog food.

Mr Carroll was grilled on the stand about whether the pricing was outside the supermarket giant’s guidelines.

So far, the case has focused on the “Down Down” promotion and whether or not there was a planned campaign to mislead customers.

The case might wrap up sooner than expected with closing arguments possible early next week.

The Australian share market has opened down -0.3% to 9,057 points.

All of the sectors are down except for energy and financials.

Here is a look:

Looking at stocks, 136 are in the red, 14 are unchanged, and 50 are gaining.

Here is a look at the top movers:

And here is a look at the bottom movers:

The Aussie dollar is trading at 70 US cents.

The Australian share market has opened down -0.3% to 9,057 points.

More to come.