Website of the YearKeeping you up to date with the latest market moves, in association with Investment firm Jarden
New Zealand
The S&P NZX50 finished the day up 0.5 per cent. The size factor was in play, with larger companies outperforming smaller ones. The S&P NZ10 was up 0.8 per cent while the S&P NZ Small Cap index was up only 0.1 per cent.
The best performing sector on the day was Information Technology, up 1.6 per cent. The next best performing sector was Health Care, up 1.5 per cent. The worst performing sector on the day was Energy, down 4.2 per cent. The next worst performing sector was Communication Services, down 0.9 per cent.
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The best performing company on the day was Payments solutions company Pushpay Holdings, up 2.2 per cent. The second-best performing company was Casino operator Sky City Entertainment, up 2.2 per cent. The worst performing company on the day was Dairy company Synlait Milk, down 7.4 per cent. The second worst-performing company on the day was Oil and Gas retailer Z Energy, down 4.2 per cent.
A2 Milk has gone into a trading halt pending an announcement. Synlait milk, as one of A2 milk's key suppliers, has notified that it has become aware of information that may require it to amend previously released guidance. The market reacted poorly to this announcement and Synlait was down 7.4 per cent at close.
The dispute between NZ Refining and Z energy has intensified with Z Energy serving a dispute notice under the processing agreement between the two companies. NZR previously announced it will be reducing its output as part of its Covid-19 response.
While NZR is reducing its capacity from 135 thousand barrels per day to 90 thousand barrels per day, it is not adjusting its fee floor. Z Energy contending that it should receive a pro rata reduction in the value it pays under the fee floor arrangement.
INTERNATIONAL
US Markets:
At the time of writing, all three major indices were up with the S&P 500 rising 0.5 per cent, the Nasdaq index up 0.7 per cent and the DIJA up 0.4 per cent. Today we continued to see rotation into Technology stocks.
All sectors were in the green today apart from Energy, which fell 0.5 per cent. Meanwhile, Utilities (+0.9 per cent), Real Estate (+0.8 per cent) and Basic Materials (+0.8 per cent) were the best performing sectors.
The European Union has conditionally approved Google's US$2.1 billion acquisition of Fitbit, setting out a number of conditions the internet giant must abide by over the next ten years. Namely, Google is restricted from using health data from Fitbit users in Europe for advertising - and must keep this sect of data separate from its parent data.
The move is interesting given Google's assurances that its acquisition of Fitbit has been driven by getting access to its hardware - and not its vast swathes of health data. Given the recent announcement and Google's response, it is possible we may find out more about what Google's game plan is.
Meanwhile, the best performing stock of the day was consulting company Accenture - up 9.0 per cent after it reported first quarter sales and earnings above market expectations. Outlook was optimistic, with earnings up 10.3 per cent to US$1.5 billion and revenue rising 4 per cent to US$12.9 billion.
Asian markets:
The Shanghai (+1.1 per cent), Hangseng (+0.8 per cent) and Nikkei (+0.2 per cent) were all up yesterday evening, tracking a strong US futures performance, as well as news that the Chinese government will be providing financial support to foreign companies to help them offset the impact of the pandemic.
The Chinese government has set aside a staggering 1.5 trillion yuan (US$230 billion) in funds to provide this assistance, available to companies operating in key areas such as special equipment and auto manufacturing.
Meanwhile, China's ride sharing giant Didi has announced a US$300 to US$400 million capital raise for its logistics and trucking division, Didi Freight. Likened to being the 'Uber of China', Didi has recently been on an expansion path - entering the Auckland market in November this year in a bid to topple the almost-duopoly between Ola and Uber. Its freight service was first released in Chengdu and Hangzhou, and now services eight cities around China - serving more than 100,000 orders each day.
Commodities:
At the time of writing, commodities continued to push higher with Gold up 1.8 per cent, trading at US$1892.5. Oil was also at new highs for the year, up 1 per cent, trading at US$48.27. The US 10-year Treasury yield was up to 0.94 per cent.
Australia
The ASX ended back in the black yesterday, up 1.2 per cent - a full recovery from the selloff seen in the last few days.
The much anticipated mid-year economic and fiscal outlook presented a bullish case on recovery, with unemployment now expected to fall back below 6 per cent a year earlier than previously expected. At the same time, the jobless rate for November beat market estimates of 7 per cent, clocking in at 6.8 per cent after 90,000 new jobs were added.
Afterpay continued to rally, up another 5 per cent while Xero also powered ahead - up 2.2 per cent. Meanwhile, media company Nine Entertainment added 3.4 per cent after it upgraded its earnings guidance to A$251 million, 30 per cent higher than its prior guidance.
Iron ore miners bounced after investor fears of a disruption to the iron ore market from China seemed to settle a bit. BHP Group was up 1.8 per cent, Fortescue was up 2.0 per cent and Rio Tinto climbed 1.8 per cent while announcing the promotion of CFO Jakob Stausholm to CEO.
On the other hand, the announcement of a new cluster in Sydney's Northern Beaches caused travel stocks to waver. Webjet (-3.0 per cent), Corporate Travel Management (-4.4 per cent) and Flight Centre (-3.0 per cent) all fell, with Flight Centre continuing to face media backlash over controversy around its alleged breach of employment law regulations.
COMING UP TODAY
International
In the US today we will see the release of initial jobless claims, along with housing starts and building permit data. The FOMC will also make their rate decision. In Europe we will see CPI data.
Australia
Coming up later today in Australia, Sydney Airport will be reporting its revenue numbers for November while National Australia Bank, Nufarm and Incitec will be holdings their AGMs.
• For more information on the latest market moves, get in touch with Jarden.
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
