Keeping you up to date with the latest market moves, in association with Investment firm Jarden
New Zealand equities ticked up 0.1 per cent yesterday with the S&P/NZX 50 closing at 12,428.6 points.
Top sector gains included industrials and utilities, each leading the way with 0.9 and 0.8 per cent increases, respectively.
Index movements were well supported by the corporate travel service provider Serko, jumping 4.9 per cent ahead of its full-year earnings release later today. Joining Serko was property company Argosy Property (+4.7 per cent), which also expects to report its full year result today.
On the other hand, markets were weighed down by both the cyclicals and healthcare sectors which fell 1.5 and 0.4 per cent, respectively.
For the second consecutive day a2 Milk was the worst performer, falling another 3.5 per cent to $5.76, its lowest price in over three years. Synlait Milk, which relies on a2 as its key customer, followed – dropping 2.3 per cent.
In other news, Timely, a Kiwi-founded appointment booking software company has been sold to an American software company EverCommerce for an undisclosed sum. The Dunedin based founders have cashed in on promising growth potential which saw Timely facilitate more than 30 million appointments worldwide this year. The purchase itself requires approval from the Overseas Investment Office – meaning a price tag of over NZ$100m to be split amongst the company's' owners and shareholders.
The major US indices were a mixed bag this morning. The S&P500 declined a slim 0.1 per cent, and the DJIA was down 0.2 per cent. Technology stocks were correcting the losses from Monday's session, pushing the NASDAQ up 0.4 per cent.
Health and Real Estate were the best performing sectors of the day, up 0.6 and 0.5 per cent, respectively. On the flipside, Energy was down 2.2 per cent and Industrials declined by 0.7 per cent.
The biggest gainer at the time of writing was Enphase Energy, rallying 6.4 per cent. The semiconductor producer announced on Monday that the board has authorised a new stock buyback program to repurchase up to US$500 million of shares until 13 May 2024.
Global media and entertainment company Viacom CBS rose 5.4 per cent following news of the big merger between AT&T's WarnerMedia and Discovery. Rounding off the top performers was pharmacy health care firm CVS Health Corp, up 4.5 per cent, hitting a new 52-week high.
AT&T was the worst performer on the day, falling another 5.8 per cent. Long-term shareholders have allegedly started selling their stake in the American multinational conglomerate, after news hit that there would be a dividend cut after the completion of the merger with Discovery.
Molson Coors Beverage Co, the holding company of beverage brands like Peroni, Coors, and Sol, decreased by 4.1 per cent. Apparel retailer Gap fell 4.0 per cent, after hitting a 52-week high at the beginning of the session.
Retail giant Home Depot (-0.6 per cent) reported US$37.5 billion revenue and US$3.86 earnings per share for the quarter ending 2 May 2021, beating analyst expectations. Customer transactions reached 447.2 million for the quarter, beating the same period last year by 19.3 per cent. The company was classified as an essential business from the on-set of the pandemic and benefitted from people spending more time and money on home improvements.
A regulatory filing revealed that investor Michael Burry, famously depicted in "The Big Short", took a US$534 million short position in Tesla shares (+1.5 per cent). Burry reasoned that the stock seems overpriced due to the electric car maker being heavily reliant on regulatory credits (government incentives to reduce carbon emissions) to generate profits. Tesla generates a large number of these credits as it only manufactures electric vehicles, and can sell them to other automakers at a profit. However, with competitors beginning to make more and more electric and hybrid vehicles, purchases of these credits from Tesla are likely to reduce.
Rest of the world
The Shanghai index was up 0.3 per cent; the Shenzhen index was up 0.2 per cent; the Nikkei 225 was up 2.1 per cent; and the Hang Seng index was up 1.4 per cent.
Chinese e-commerce platform Huitongda Network Co is considering an IPO in Hong Kong, which could raise as much as US$1 billion. The company is backed by Alibaba Group Holdings (+1.1 per cent) and could go public by the end of the year.
Credits in the EU's carbon trading program continue to outperform. The December 2021 carbon contract surpassed €50 for the first time earlier this month versus €20 pre-pandemic. Analysts say there is more room for growth, as carbon dioxide emissions are capped for many businesses and the program allows companies buy and sell surplus credits.
The unemployment rate in the UK fell to 4.8 per cent in the first three months of 2021, with the number of people in employment increasing by 84,000, beating expectations. This is the first increase since the pandemic began.
Gold was trading at US$1,869.30 per ounce, up a slim 0.1 per cent. Silver rose 0.3 per cent to US$28.37.
Oil prices fell by 1.3 per cent to US$65.43 a barrel.
Cryptocurrencies were a mixed bag, with Bitcoin decreasing a further 2.7 per cent and Ethereum increasing by 0.5 per cent.
The US 10-year yield continues to stay reasonably flat at 1.649 per cent.
The ASX 200 climbed 0.6 per cent yesterday, following a strong start to the week in the US the night before.
Gold miners led the index up, with Oz Minerals (+6.4 per cent), Perseus Mining (+4.3 per cent) and Evolution Mining (+4.9 per cent) all booking mid-single digit gains after an uplift in the gold price overnight.
However, industry player St Barbara dropped 9.0 per cent after announcing that labour and skill shortages at its Leonora operation could cause the company to reduce its production for the year from 175,000 ounces to as little as 150,000 ounces.
Energy companies were also strong, with Beach climbing 2.7 per cent and Oil Search up 2.6 per cent.
Construction firm James Hardie dropped 4.5 per cent after it warned that higher lumber and freight prices across the world may create a drag in earnings of up to A$193 million for the full year.
These issues were further acknowledged in the Reserve Bank of Australia's minutes, which were also released yesterday. The Central Bank expects the ongoing supply chain disruption internationally to create a short-term inflation tailwind – although maintain a low inflation outlook for the medium term.
The recently embattled Nuix continued to make headlines, jumping 11.5 per cent following an acceptance of responsibility from the company's executives for the distrust the company has attracted in relation to media reports of questionable governance and accounting in the years before its listing. Shares remain more than 70 per cent lower than Nuix's listing price in 2020.
Coming up Today:
Today will see Vodafone NZ owner Infratil report its full-year earnings, as well as real estate investment trust Argosy and corporate travel service provider Serko.
Auckland Airport will be providing its March Sales and Revenue Update, although the key takeaway from this will be the preliminary April figures they are expected to provide in the report. April will be the first month in which the effects of the trans-Tasman bubble reopen can be gauged.
In Australia, Webjet and United Malt will be reporting results for their full year and half year performances, respectively.
Further abroad, the UK will be reporting its latest inflation numbers later in the evening.
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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-disclaimera>