US Federal Reserve Board Chairman Jerome Powell. Photo / Getty Images
Keeping you up to date with the latest market moves, in association with Investment firm Jarden
The NZX 50 fell for the second day in a row, closing 0.5 per cent lower on Wednesday.
Most sectors ended in the red, led by industrials (-1.6 per cent) and
consumer cyclicals (-1.1 per cent). Three sectors closed higher, namely technology (+1.1 per cent), consumer staples (+1.1 per cent) and financials (+0.6 per cent).
Leading the index lower was Kiwi Property Group, declining by 3.7 per cent, reversing its upward trend over the past week.
Yesterday, Singapore-based Olam International received the green light from the Overseas Investment Office for its $100 million investment in a new dairy processing plant in Tokoroa. The plans for this undertaking were first revealed in September this year, with the first part of the plant aimed to be operational in the first quarter of 2023.
This new development increases competition for Fonterra. The Fonterra Shareholders' Fund underperformed in response, down 3.5 per cent, despite an affirmed 'A' rating from Fitch yesterday.
Also down was film software company Vista Group International, decreasing 3.3 per cent, reversing the upward trend from earlier in the week.
The best performer on the NZX 50 yesterday was mobile network provider Spark New Zealand, rising 2.3 per cent after a poor performance on Tuesday.
The a2 Milk Company also performed well, up 2.1 per cent, followed by Synlait, which closed 1.8 per cent higher.
Statistics New Zealand released data yesterday that showed the country's seasonally adjusted current account deficit widened to $4.8 billion in the September 2021 quarter (up $1.7 billion vs previous quarter) due to growth in imports. The value of goods and services imports rose $1.8 billion and $123 million, respectively, on the previous quarter. Goods exports also increased, up $209 million, while services exports decreased by $114 million.
New Zealand's gross domestic product (GDP) for the September 2021 quarter will be released today.
US equities were down for a third day with the S&P 500 (-0.3 per cent), Dow Jones Industrial Average (-0.02 per cent), and the Nasdaq (-0.9 per cent) all in the red late in the session but moved into the green near the end of the trading day.
The Federal Reserve policy meeting decision will be released later this morning, with the market keenly awaiting any take-aways for how the central bank views inflation and interest rates. [For the latest on the Fed decision, read US Federal Reserve will cut back stimulus amid inflation concerns].
Utilities and healthcare rose 1.1 and 0.8 per cent, respectively.
Eli Lilly and Co gained 8.7 per cent, announcing it has entered into a strategic collaboration agreement this week with Foghorn Therapeutics.
Meanwhile, insurance company Progressive Corp rose 6.0 per cent after a positive November 2021 result.
Exerting downwards pressure on the S&P 500 were the energy and consumer discretionary sectors.
Nucor Corp fell 11.7 per cent. The steel-based products company fell on the back of a change in outlook from the company, warning of soft profits amid declining volumes at steel mills with year-end seasonality.
Medtronic declined 6.8 per cent to a new 52-week low. It announced it received a warning letter from the U.S. Food and Drug Administration (FDA) on 9 December for issues with the company's California facility, the headquarters for its diabetes business. Following an inspection of insulin pumps, the letter outlines inadequacy of specific medical device quality system requirements at the facility.
Asian indices were a mixed bag overnight with the Hang Seng trading lower by 0.9 per cent, the Shanghai Composite down 0.4 per cent, and the Nikkei up 0.1 per cent.
In commodities this morning, gold has fallen 0.8 per cent to US$1,767.20 per ounce. WTI crude oil fell 0.3 per cent and is priced at US$70.30 per barrel at time of writing.
In cryptocurrencies, Bitcoin fell 1.0 per cent to US$47,086.40 and Ethereum lost 2.7 per cent to US$3,719.58.
The US 10-year bond is now 1.445 per cent, ahead of the Federal Reserve's December policy meeting today.
Australian equities were in the red yesterday with the S&P/ASX 200 trading lower by 0.7 per cent to close at 7326.8 points.
Westpac Bank consumer confidence index showed an easing from highs seen in late November, as the index fell one per cent from 105.3 points to 104.3.
This was in line with Tuesday's Commonwealth Bank credit card spend and National Bank of Australia's business confidence survey. In states hit by a rise in Covid-19 cases and Omicron variant, confidence eased considerably (New South Wales and Victoria), while Western Australia, South Australia, and Queensland returned positive incremental gains from the previous measurement period.
The only sector to make a gain was utilities, up 0.3 per cent.
Overall index movements were well supported by the single stock winner Virgin Money (+4.1 per cent), which traded well, in line with its main listing in the UK. Its parent company passed the first round of 'stress tests', meaning the company will not be required to take further capital management actions.
Similarly, mining company Alumina Ltd and AGL Energy traded favourably, rounding out the single stock winners with gains of 3.6 and 2.4 per cent, respectively.
On the other hand, markets were weighed down by both the educational, and technology sectors, which fell 2.7 and 1.6 per cent respectively by market close.
The underperforming single stocks were headed by Pointsbet Holdings, which fell 7.4 per cent despite limited news flow. Furthermore, financial services company HUB24 lost 7.1 per cent following its monthly presentation and AGM results on Tuesday.
In other news, Superannuation Minister Jane Hume highlighted that the Australian Government has no intention of freezing increases to the current superannuation guarantee rate. The rate may become an election issue moving forward, and could be an important driver for Australian capital markets going forward.
• For more information on the latest market moves, get in touch with Jarden.
Disclaimer: The Jarden Brief is provided for general information purposes only. It reflects views and research available 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. The Jarden 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 financial advice disclosure statement is available free of charge at https://www.jarden.co.nz/our-services/wealth-management/financial-advice-provider-disclosure-statement/ Full disclaimer available at: https://www.jarden.co.nz/wealth-sales-and-research-disclaimer
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