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Keeping you up to date with the latest market moves, in association with Investment firm Jarden
New Zealand
NZX Market Wrap-Up:
The NZX50 traded down 0.5 per cent yesterday as dairy companies a2 Milk and Synlait Milk both continued their downward trend. a2 declined 4.9 per cent, to close at $15.84 - levels not seen since March this year. Meanwhile, Synlait also slid, dropping 3.4 per cent to $5.41. Fletcher Building also had a weak day, falling -2.6 per cent.
Gentailers pulled back slightly after yesterday's jump with Genesis (-1.9 per cent), Meridian (-1.8 per cent), Mercury (-1.2 per cent) and Contact (-0.3 per cent) seeing moderate declines.
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On the other hand, Chorus and Kathmandu were the best performers, rising 2.5 and 2.4 per cent, respectively.
International
US Markets:
At time of writing, the three main indices were all down with the SPX500 (-0.5 per cent), the Dow Jones (-0.6 per cent) and the Nasdaq (-0.1 per cent) all pulling back from yesterday's gains.
The Energy and Financials sectors performed the worst in the SPX500 index, respectively down 3.4 and 1.6 per cent. On the other hand, Technology was more resilient, down a mere 0.1 per cent. Buoying the sector was microprocessor producer AMD (+3.1 per cent), which was the best stock in the index.
Oil stocks fell amid renewed concerns about oil demand going forward. The millionth coronavirus death occurred overnight, perhaps bringing the pandemic back to the fore for some investors on an emotional level.
Devon Energy, which yesterday announced a merger, was the worst stock in the index, down 8.0 per cent. Apache, National Oilwell Varco, EOG resources, Marathon Oil and Haliburton all featured among the worst performers, all falling more than 5 per cent.
Asian markets:
Asian markets fared better with the Shenzhen Index up 1.0 per cent, the Shanghai index up 0.2 per cent and the Nikkei 225 up 0.1 per cent.
China's second-largest property developer Evergrande has reached an agreement to avoid repayments that would have led to significant strain on the company's balance sheet. This deal addresses the core liquidity concern that had investors worried that default would send a critically destabilising shock through the Chinese economy.
China has a long history of bailing out strategically important companies. Even before this latest announcement, the company's bonds had rallied as investors speculated that the company would be "too big to fail". Following the announcement, the company's note due 2025 rose 8.2 per cent.
Commodities:
At time of writing, Gold was up 0.6 per cent, trading at US$1893.4 per ounce. WTI Crude was down, trading at US$40.0 per barrel. The 10-year treasury yield was down to 0.66 per cent.
Australia
ASX Market-Wrap
The ASX 200 fell flat for the day, with 1.5 stocks rising for every decline.
With little news out for the index was unable to gain any momentum throughout the day with the Financial sector and Utilities sector dragging the market down.
The Bank of Queensland (-7.25 per cent) was the biggest decliner on the day after further adjusting their bad debt provision to 37 basis points of their book, equivalent to an extra A$175 million.
On the other hand, Tech was up 1.5 per cent with Xero (+3 per cent) and Afterpay posting solid gains (+2.5 per cent). Xero is closing in on their all-time high posted on September 3 (which acted as a resistance level) after further positive reports regarding the recovery of small businesses.
Corporate Travel Management company has announced that they are to buy Omaha-based company Travel & Transport in what may be a bold move to scale up their position in the mid-market travel agency sector. The deal has been set at US$200.4m, which Corporate Travel Management will pay for through their US$350m equity raising.
Australian Wealth manager AMP has turned to the potential of selling their entire real estate business, with Charter Hall and Dexus Property Group seen as the main contenders.
Treasury Wine Estates boss has been selected as one of the Wine exporters to respond to dumping allegations set forth by China. This action is likely to hurt the sector, with the investigation likely to mean fewer exports to China – a channel which currently represents A$1.2 billion of exports. Treasury Wine Estates' Chinese business alone represents 17 per cent of sales and 25 per cent of earnings, which has led to investors to sell off the stock.
The stock has been down around 30 per cent since August 13.
Coming up today
Eyes will be on the first US presidential debate as investors look for any suggestions that stimulus will be forthcoming before the election. It will also be interesting to assess the candidates' performances and any impacts they may have on the upcoming election. Trump presently trails 8 per cent in the polls.
The ADP employment report, SAAR GDP revision, Chicago PMI figures and Pending home sales index data will be released overnight, and four US companies are set to release their results.
Meanwhile, in New Zealand, Genesis Energy will be holding their AGM later today - any response or comments concerning Tiwai Point will be of key interest although additional clarity is unlikely. Their current ebitdaf guidance for the 2021 financial year is set at $395 to $415m.
• 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