Jarden Brief: Airlines find support as Delta returns to profit

Delta Air Lines expects to return to profit this quarter as higher bookings offset rising fuel costs. The stock was up 5.7 per cent. AP Photo/Mike Stewart

Keeping you up to date with the latest market moves, in association with Investment firm Jarden

International
US

US markets were in the green this morning (NZT), with the S&P 500 up 0.8 per cent, Dow Jones Industrial Average improving 0.6 per cent and the Nasdaq rising 1.6 per cent.

Most sectors were trading higher at the time of writing. Consumer discretionary rose 2.0 per cent, while technology and energy gained 1.1 per cent a piece.

American Airlines Group led single stocks, increasing 9.7 per cent. Investors may have reacted positively to the news that competitor Delta Air Lines expects to return to profit this quarter as higher bookings offset rising fuel costs. Delta was up 5.7 per cent, with travel peers Southwest Airlines (+6.8 per cent), United Airlines (+5.5 per cent) and Norwegian Cruise Line (+6.3 per cent) among the top performers.

Real estate investment trust Host Hotels & Resorts rose 7.6 per cent. Pharmaceutical firm Moderna rounded out the top three gainers, improving 7.5 per cent.

Utilities and financials were the only sectors in the red at the time of writing, falling 0.4 and 0.3 per cent, respectively.

Biopharmaceutical company AbbVie was the biggest laggard, sliding 4.5 per cent. PayPal stock was down 3.9 per cent. The firm's chief financial officer John Rainey is departing for Walmart.

Rest of the World

Asian markets were a mixed bag overnight. The Nikkei climbed 1.9 per cent and the Hang Seng recorded a 0.3 per cent improvement. Conversely, the Shanghai Composite declined 0.8 per cent.

Honda has announced plans to invest JPY 5 trillion towards electrification and software, comprising of 3.5 trillion yen for R&D and 1.5 trillion for investments. The Japanese carmaker set an EV production target of more than 2 million units per year in 2030, as the company moves to keep up with automotive sector electrification. To meet production targets, Honda plans to set up EV plants in China and North America and explore the establishment of a battery production joint venture company.

New Japanese Cabinet Office data shows a seasonally adjusted reduction in machinery orders of 10.6 per cent in February, compared to the previous month. Core machinery orders, which exclude volatile ship and utility orders, declined by a seasonally adjusted 9.8 per cent over this period. The drop has aggravated concerns that rising input costs could dampen investment among Japanese firms.

China's trade with Russia increased 27.8 per cent year-on-year in the first quarter of 2022, while trade with Ukraine rose 10.6 per cent.

Commodities

Gold gained 0.4 per cent to US$1,983.20. Oil prices increased, with the WTI Crude price at US$104.10 at the time of writing (+3.4 per cent). The US 10-year government bond currently yields 2.678% (-0.049).

Cryptocurrencies were trading in the green at the time of writing, with Bitcoin climbing 4.3 per cent and Ethereum up 3.7 per cent.

New Zealand

The NZX 50 decreased by 0.3 per cent yesterday.

The Reserve Bank of New Zealand lifted interest rates by 50 basis points yesterday taking the Official Cash Rate to 1.5 per cent. With core inflation measures at or above 3 per cent, the Committee agreed to continue tightening monetary conditions at pace to best maintain price stability. Both 25 and 50 basis point hikes were on the table, but the RBNZ said the latter was chosen partly because it provides "more policy flexibility ahead in light of the highly uncertain global economic environment".

The top performer of the day was Port of Tauranga rising 2.5 per cent. Infrastructure company Vector was up 2.4 per cent and NZX Limited (operator of New Zealand's stock exchange) increased 2.2 per cent.

Conversely, Trustpower was the biggest underperformer falling 5.6 per cent. The electricity company released a market update which included commentary on its strategy, financial outlook and the sale of its retail business. Road charging and services provider EROAD dropped 4.1 per cent after it released its Leadership and Quarterly Operational Update. Manufacturing company Skellerup Holdings completes the bottom movers with a decline of 2.8 per cent.

Auckland Airport increased 1.9 per cent after Australians began arriving in New Zealand yesterday following the opening of the country's borders to Australian travellers.

Chorus released its Q3 2022 full year connections update yesterday. Total fibre connections increased 21,000 to 939,000 and total broadband connections increased 3,000 to 1,190,000. The telecommunications company closed 2.1 per cent higher.

At 11.59pm yesterday the country moved to the orange traffic light pandemic response setting. The Covid-19 Response Minister stated the change was justified for several reasons, including an ongoing decline in cases. Under this setting there are no indoor or outdoor capacity limits and seated-only rules have been removed.

Australia

The ASX 200 rebounded yesterday, closing 0.3 per cent up. Energy and materials were the best performing sectors increasing 1.0 and 0.6 per cent respectively.

EML Payments jumped up 10.5 per cent, yesterday's biggest increase of the day. EML said it had ceased talks with Bain Capital about it potentially acquiring EML.

Paladin Energy bounced up 9.6 per cent following upwards pressure on the uranium price.

For the second day in a row, Regis Resources closed in the top three with a 5.9 per cent increase. That brings Regis Resources 10.8 per cent up from the start of the week.

Cement manufacturers Adbri and James Hardie Industries experienced the biggest losses, falling 4.6 and 2.9 per cent respectively.

Closing out the three largest declines is investment advice company Perpetual, with a 2.3 per cent drop.

Minerals and energy were heavily traded. The three most actively traded shares were Lithium producers Pilbara Minerals and AVZ Minerals with Paladin Energy also making the top three.

General Motors Co and Glencore announced a multi-year deal in which Glencore will provide cobalt from the Murrin Murrin mines in Western Australia. This will support General Motors Co building their electric vehicle fleet and will maintain their supply chain management.

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