The bizarre story of GameStop continues to roll on. Photo / Getty Images
Keeping you up to date with the latest market moves, in association with Investment firm Jarden
New Zealand
The S&P NZ50 finished the day up 0.4 per cent.
The best performing sector on the day was Consumer Staples, rising 3.4 per cent up after dairy exporter A2 Milk, which climbed 3.9 percent, may have been buoyed by continued institutional buying. SPH notices over the past two trading days have indicated that a couple of large overseas banks have increased their stake in the company.
The next best performing sector was Real Estate, advancing 1.3 per cent led, by real estate investment trust Argosy Property which advanced 2.6 percent.
Meanwhile, the Materials sector retreated 3.1 per cent after construction company Fletcher Building saw a reversal of yesterday's gains, dropping 3.1 per cent.
The next worst performing sector was Industrials, which slid 0.4 per cent.
Gold Mine operator New Talisman Gold Mines (up 20 per cent) has come out of trading halt after announcing that it has a binding option to acquire Broken Hills Gold Mine.
Broken Hills is a small scale, high grade mine with a history of profitable production over the past 21 years. The company says there is significant potential to expand resources at depth through existing underground infrastructure.
With a 2020 net loss after tax of 3.7 million, funded almost entirely by capital raisings, getting a proven revenue stream into the business will provide shareholders with something more than an option on some mineral discovery. Additionally, with spot gold up approximately 23 per cent since January 2020, any discovery would be more profitable to excavate. New Talisman is down approximately 14 per cent over the same period.
Retailer generator Meridian Energy (down 1.9 per cent) released its operating report. In the month to 18 January 2021, national hydro storage fell from 95 per cent to 79 per cent of the historical average. National electricity demand was down 0.9 per cent month on month, and calls were made under the Genesis swaption – a contract whereby Meridian can purchase electricity to cover production when lakes are low.
Sales in most segments are up month on month with residential (+8.8 per cent), SME (+22.0 per cent), large business (+8.3 per cent) and corporate (+15.7 per cent) all increasing.
INTERNATIONAL
US Markets:
All three major indices were down overnight, following a sea of red in European bourses. The DJIA and NASDAQ were both down 1.0 per cent at time of writing, while the S&P 500 slid down 1.3 per cent.
The Energy sector saw a slight rebound this morning, recovering 1.1 per cent while Communication Systems (-2.5 per cent), Financials (-2.1 per cent) and Healthcare (-2.0 per cent) led the market decline.
EB Games owner Gamestop surged another 131.3 per cent overnight to US$340.51, up 1877 per cent since the start of the year as the great short squeeze of 2021 continued. Other heavily shorted stocks were also up overnight as retail investors are attempting to find the next big play, such as Blackberry (+20.2 per cent), struggling movie chain AMC (+207.7 per cent) and Virgin Galatic (+22.6 per cent).
Some abatement was seen after a report that targeted hedge fund Melvin Capital had closed their short position, although online forums were quickly flooded with comments alleging the claim was a hoax.
Meanwhile, aircraft maker Boeing posted a loss of US$15.25 a share in the fourth quarter – far lower than consensus estimates of US$1.80 loss per share. The stock is currently trading down 3.2 per cent, as revenue of US$15.1 billion hit estimates and most of the loss was a non-cash charge.
Asian markets:
Asian markets were flat yesterday, with the Shanghai index up 0.1 per cent, the Nikkei up 0.3 per cent and the Hangseng down 0.3 per cent.
Commodities:
At time of writing, Gold was up by 0.1 per cent, trading at US$1852.20 per ounce. WTI Crude was down 0.3 per cent, trading at US$52.59 per barrel.
Australia
The S&P ASX200 finished the day down 0.7 per cent. Smaller companies outperformed as the S&P ASX Small Cap Index was down only 0.3 per cent.
The tech sector performed well, rising 1.4 per cent followed by Consumer Staples, which climbed 1.1 per cent. The index was dragged down by the Energy and Materials sectors however, falling 3.4 per cent and 3.0 per cent, respectively.
The Materials sector was weighed by iron ore miner Fortescue Metals, which fell 6.4 per cent as the worst performing company on the day. Mining companies Oz Minerals (-5.8 per cent) and Lluka Resources (-5.5 per cent) also performed poorly.
On a day when other gold miners were down, Resolute Mining was an exception, up 2.1 per cent. The company announced a growth in underground resources at its Tabakoroni site to 1.26 million ounces at a grade of 4.9 grams per tonne of earth. It also announced promising drilling results with grades as high as 11.2 grams per tonne from 317 meters down. The company has promised to continue drilling at the site through 2021 to build up Tabakoroni's reserves and strengthen the case for future development at the site.
On the Energy front, fossil fuel explorer and producer Oil Search (down 3.3 per cent) has announced that it expects to begin work on an AU$3.9 billion oil project in Alaska. If completed on schedule, the joint venture project will produce approximately 80 thousand barrels of oil a day. However, the mood was soured by guidance allowing for a fall in this year's production. The company has flagged an output dip to the tune of 29 million barrels for 2021, owing to maintenance shutdowns at two of its production units near Port Moresby.
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Disclaimer: This Morning Brief has been prepared in good faith and reflects opinions and views at the time of publication, using external sources, systems and other data and information we believe to be accurate, complete and reliable at the time of preparation. We make no representation or warranty as to the accuracy, correctness and completeness of that information, and will not be liable or responsible for any error or omission. This Morning Brief is not to be relied upon as a basis for making any investment decision. Please seek specific investment advice before making any investment decision. Jarden Securities Limited is an NZX Firm, a broker disclosure statement is available free of charge at www.jarden.co.nz. Jarden is not a registered bank in New Zealand. Full disclaimer available at: https://www.jarden.co.nz/limitations-and-disclaimer
This recovery is making us sweat, but that might be a good thing in the long run.