New ZealandNZX Market Wrap-Up:
The NZX50 had an improved performance yesterday, rising 0.6 per cent. Oceania Healthcare was the best performer of the day after it gained 3.5 per cent, and Kiwi Property Group continued yesterday's solid performance to rise 3.3 per cent.
Recent NZX 50 entrant Serko was placed into a trading halt yesterday after it announced a $55 million capital raise comprising of a $45 million placement to institutions and a $10 million share purchase plan to existing shareholders at a floor price of $4.35 per share, a 3.5 per cent discount to the stock's last close ($4.51).
Although the company advised that it currently holds $33.6 million cash, proceeds from the raise will be used to accelerate development & expansion, including to fund small M&A opportunities aligned to strategy, if and when they arise.
Serko's recent inclusion in the NZX 50 saw it rise nearly 23 per cent in September, and thus the company may feel that its high stock price creates a good opportunity to raise equity.
The worst performers were Skellerup, declining 2.7 per cent followed by Napier Port, down 1.7 per cent. a2 Milk also continued its decline to close $15.19, down 1.0 per cent.
At time of writing, the SPX500 was up 0.5 per cent, the Dow Jones Industrial up 0.2 per cent and the Nasdaq up 1.2 per cent.
Consumer Cyclicals and Technology were the best performing sectors in the SPX500, up 1.1 and 1.0 per cent, respectively, while the Energy sector dropped 2.8 per cent.
By one measure of internal index strength, we have seen a bounce back from September lows. The percentage of SPX500 stocks trading above their 50-day moving average fell to 24.6 per cent on September 24th and has since recovered to 44 per cent. Were this measure to again collapse through 22 per cent, analysts speculate it might trigger a race to the bottom.
Online transaction facilitator Etsy was the best stock in the index, up 8.9 per cent. Oil company Valery energy was the worst stock in the index, down 7.2 per cent.
Chinese markets were closed for the Mid-Autumn festival. Trading on the Nikkei 225 has been halted by a technical glitch.
Police have flooded the streets of Hong Kong to pre-empt the possibility of protests on the national holiday, making 70 arrests so far. The imposed order marks a departure from the massive demonstrations which paralyzed the Asian financial hub on the same day last year.
At time of writing, Gold was up 1.4 per cent, trading at US$1912.5 per ounce. WTI Crude was up 0.2 per cent, trading at US$40.25 per barrel. The ten-year treasury yield was up to 0.7 per cent.
The ASX200 had a strong start to the fourth quarter on high volumes which recovered some of Wednesday's losses.
The index ended up just shy of one per cent, in line with the ASX 100 and ASX 300's performances. Real Estate was the main outperformer on the day with every stock rising and the sector as a whole up 2.1 per cent. Other well performing sectors included Materials and Consumer Non-Cyclicals, both up 1.5 per cent, while Academic and Educational Services was the only sector in the red.
Industrials company Reliance Worldwide was the best performing stock of the day, finishing up 10.5 per cent to A$4.22 following a surge in September sales for the Americas and Europe. BNPL Zip Co also performed very well up 7.0 per cent. On the other hand, finance company OmniBridge Limited was the worst performing, down 3.1 per cent.
Adore Beauty's IPO book build began today with stockbrokers setting the A$6.39 price point at 3.9 times forecasted 2020 revenue, resulting in an implied A$620 million enterprise value. Fund managers were told that at this price level, demand will exceed supply.
Select Harvest are poised to announce an acquisition of A$159 million for almond farms, to be done through a A$120 million equity raising at A$5.20 per share.
Optus believes video game popularity will continue to surge outside of Covid-19 and are preparing to launch a $10 a month NBN plan add-on as part of a new gaming strategy. It is said that they will route the internet traffic to the most optimal path available so that gamers can get optimal speed on their servers.
Coming up today
Coming up today, New Zealand QV house prices and consumer confidence is set to be released. As the country has moved into looser Covid-19 alert levels, analysts may hope, and or expect to see improved consumer confidence.
Meanwhile, Australian retail sales figures for August will be out today, which may play on investor sentiment as retail exposed stocks seemed to receive positive attention yesterday. On the other hand, if results are poor, it may lead to a negative market reaction.
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