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New Zealand
NZX Market Wrap-Up:
The NZX 50 was just in the red yesterday, down 0.1 per cent. The worst performers were Chorus (-2.6 per cent), Vista Group (-2.3 per cent) and Contact Energy (-2.1 per cent).
Wednesday's star performer, Pushpay, continued its run back toward peak June/July levels as it rose 4.2 per cent to close the day on $8.54. Meanwhile, Restaurant Brands was the best performer as it rose 4.6 per cent albeit on low volumes.
Mercury announced their revised 2021 ebitdaf financial year guidance from $515 million to $505 million. The company stated this was a reflection of "an expected 200 GWh decrease in full-year hydro generation to 3,700 GWh due to dry weather conditions in the Taupo catchment in FY2021 to date." The stock traded down 0.6 per cent following the announcement.
International
Overnight wrap:
Overnight markets somewhat arrested their declines. Speculation abounds that stimulus talks will resume given concern about a resurgence of Covid-19 in Europe. Low rates are supporting equity values both theoretically, in that the discount rate is low, and practically, in that bonds are not representing an attractive alternative to owning stocks.
US Markets:
At time of writing, the S&P 500 is up 1.3 per cent, the Dow Jones is up 1.1 per cent and the Nasdaq is up 1.3 per cent.
Utilities and Real estate were the best performing sectors on the day, up 1.7 and 1.5 per cent respectively. Healthcare was the only sector in the red, falling by 0.2 per cent.
Olive Garden restaurant operator Darden Restaurants was the best performer on the day, gaining 9.6 per cent on the release of their second-quarter results. Sales were at 82 per cent of the same quarter last year, with ebitda outperforming analyst expectations by 33 per cent.
Chemicals developer and producer Albemarle regained some of its losses from yesterday, up 6.1 per cent. Mining company Freeport-McMoRan did the same, up 5.4 per cent.
Used car retailer Carmax was the worst stock on the market, down 9.6 per cent. Though an inventory shortage through Covid-19 lockdowns hurt sales, revenue and earnings per share (as reported in the company's second-quarter results) both outperformed analyst expectations.
Asian markets:
At time of writing, the Shenzhen index was down 2.2 per cent and the Shanghai index was down 1.7 per cent. The Nikkei 225 was down 1.1 per cent.
Chinese development company Evergrande has warned officials that it is facing default unless it is permitted to proceed with its Shenzhen exchange listing. On 31 January of next year, investors are permitted to exit the company should the listing not proceed.
Evergrande would be forced to repay 92 per cent of its cash and equivalents, the equivalent of US$19 billion. Such an event could lead to "cross defaults" of the company's borrowings and would create systematic risks for the wider financial system.
Commodities:
At time of writing, Gold was up 0.6 per cent, trading at US&1874.3 per ounce. WTI Crude was up 0.3 per cent, trading at US$37.8 per barrel. The 10-year treasury yield was flat at 0.7 per cent.
Australia
ASX Market-Wrap
The ASX 200 pared back some of yesterday's gains following drops in overseas markets the on Wednesday night. The benchmark index opened down 1.7 per cent but slowly recovered throughout the day, ending down 0.8 per cent with 1 stock rising for every 4 that decreased. The Academic & Educational services sector continued to outperform, being the only sector in the green whereas Energy and Technology lost a respective 1.9 and 1.7 per cent.
Cleanaway Waste Management chief executive has forfeited A$2.3 million of performance rights following allegations surrounding the company over the last of couple weeks. The company recovered some of this week's losses on the announcement, ending the day up 0.31 per cent.
Austrac Chief executive posted further threats to Australian corporates by saying that Westpac's A$1.3 billion fine may not be the last of its nature if companies continue to fail anti-money laundering rules.
Woolworths has sought clearance for a A$552 million acquisition in a 65 per cent stake of service food provider PFD. The Australian competition regulator is due to make its decision on 12 December, and a decision in favour of Woolworths is expected to give them further dominance in the supermarket sector.
Investment company Washington H Soul Pattinson posted a 284.3 per cent statutory profit, mostly due to its merger of TPG and Vodafone. Excluding this one-off event, the company had underlying profit down 44.7 per cent. The company rose 0.9 per cent after it announced it will pay a A$0.35 dividend, up 2.9 per cent.
Coming up today
Locally listed retailer Hallenstein & Glassons will release their 2020 financial year earnings. The group has already released unaudited year-end sales of $287.8 million, with unaudited net profit after tax expected to be within the range of $27.2 million to $27.8 million. As such, there should be limited surprises in their earnings tomorrow, although investors will likely be focused on commentary regarding a potential final dividend.
Tonight in the US, Sunlink Health Systems will be reporting its earnings to market. Additionally, the durable goods orders and the core capital goods orders for August will be released. These figures reflect new orders placed with manufacturers and gives some indication of the health of the durables and capital goods sectors.
Meanwhile, in Australia, retail sales figures for August will be released. This may give an indication on whether further lockdowns hurt the market, or if consumers continued to turn to online shopping as with the last lockdown.
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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