Justine Smyth's departure as a director of Pushpay helped dampen its share price. Photo / Supplied
Keeping you up to date with the latest market moves, in association with Investment firm Jarden
NZX Market Wrap-Up: Light volumes and few large moves, Pushpay and Comvita the exceptions
The New Zealand market had a muted Monday, with only 25.4 million index stocks changing hands. The NZX50 was down slightly (-0.3 per cent), with few significant moves for the larger stocks.
Pushpay continued its decline, falling 4.1 per cent, as investors continued to sell after the Hulijich family block transaction last week. The resignation of independent director Justine Smyth, also chair of Spark and the Breast Cancer Foundation NZ after just 11 months at the company, may have further fuelled negative sentiment.
Pushpay is now trading down 17.0 per cent compared to last week.
Honey exporter Comvita rose 6.4 per cent, now up 14.2 per cent week on week.
Mercury is up slightly on its fourth quarter update
NZX-listed gentailer Mercury has provided an update on their performance during the final quarter of their financial year, with results roughly in line with market expectations.
Generation was down 5.2 per cent compared to the previous year by volume, after a drought contributed to lower hydro generation of 727 gigawatt hours, down from 796 gigawatt hours last year.
Electricity sales were also down by 4.0 per cent compared to last year's fourth quarter. Commercial and industrial sales to large customers increased slightly and mass market sales decreased.
Mercury also noted that refurbishment has been completed at Whakamaru and Aratiatia (hydroelectric power stations on the Waikato).
Mercury has been one of the less volatile gentailers over the last few weeks. Competitors Meridian and Contact have dropped 9.9 and 13.7 per cent respectively since the Tiwai exit decision this month. Mercury has only dropped by 4.7 per cent as of last close, given its lesser exposure to South Island demand.
Warehouse confirms up to 750 staff will be cut in restructure
WHS has told staff up to 320 full-time equivalent roles are going, and six stores will close across their top three brands (The Warehouse, Warehouse Stationery and Noel Leeming).
Between 500 and 750 employees could be affected if part-time, fixed-term and casual roles face similar cuts.
The updated number is less than the 800 to 1080 originally proposed last month.
Regardless, Prime Minister Jacinda Ardern was "angry" that the Warehouse had not tried harder to retain their staff.
The stores to close are The Warehouse stores at Johnsonville, Dunedin Central and Whangaparaoa and a Warehouse Stationery in Te Awamutu. Noel Leeming stores in Papanui and The Palms will also be consolidated to a new store in Northlink, Christchurch.
International Market Wrap-Up: Strong start
The international markets started the week off strongly with positive news from University of Oxford, Pfizer Inc and BioNtech around Covid-effective antibodies and T-cells being produced in trials.
China's Shenzhen market was up 2.55 per cent, also sending positive signals to risk assets around the globe. At the time of writing the Dow Jones is up 0.06 per cent, the S&P 500 is up 0.65 per cent and the Nasdaq is up 2.03 per cent, with big tech firms recovering strongly from last week's underperformance.
At the time of writing, Amazon is up 6.21 per cent, with Goldman Sachs' analyst increasing the target price from US$3000 to US$3800 per share. Alphabet is also up 2.5 per cent with Credit Suisse's analyst increasing the target price from US$1600 to US$1850 per share.
Other major tech stocks causing the Nasdaq to outperform are Shopify, Zoom Video, Spotify, MasterCard and Visa, up 7.3 per cent, 8.05 per cent, 10.13 per cent, 3.05 per cent and 2.07 per cent respectively.
Stimulus package decisions in Europe and America are coming up this week - the United States' federal unemployment benefit is set to stop, or be renewed, on July 31.
These packages are crucial to the economic recovery. Volatility is likely as stock markets react positively or negatively depending on the size of the stimulus provided.
Covid-19 still rapidly spreading in many American states so unemployment rates are likely to remain above 11 per cent. Another large stimulus package may be needed to keep the economy moving.
Commodities:
At the time of writing WTI Oil is at just under US$41 a barrel (+0.54 per cent), and Gold is at US$1820 per ounce (+0.5 per cent). The US 10-year treasury note is slightly down 1 basis point to 0.618.
Australia
ASX Market Wrap-up: Banks drive dip
Losses from the major banks weighed on the S&P/ASX 200 as it dipped 32 points to 6001.5 (-0.5 per cent). NAB slid 1.6 per cent to A$17.81, Westpac and ANZ dropped 1.2 per cent and Commonwealth Bank fell 0.8 per cent. Viva Energy and Telecom suffered the largest losses to fall 5.7 and 5.3 per cent, respectively. Resolute Mining led the ASX200 as it rose 4.7 per cent, and Afterpay recovered losses from last week to close the day at A$69.49, an increase of 3.2 per cent.
Gold Miner, Northern Star Resources continues to trade on its highs as strong demand holds gold prices above US$1800 an ounce. Bluescope Steel also traded strongly off the back of strong earnings before interest and tax, ahead of many brokers estimates (+3.0 per cent). Health food manufacturer Forbidden Foods opened its IPO looking to raise A$6 million at A$0.20 per share.
From midnight on Wednesday masks are to be compulsory across Melbourne and the Mitchell Shire area. NSW recorded 20 new cases, their highest number of daily cases in months and Victoria added 275 cases yesterday. Concerns continue to grow as the caseload worsens, clouding the market outlook. Sydney Airport is set to suffer from the Victorian lockdown - passenger numbers are to plunge again as Perth airport becomes the busiest in the country. Sydney Airport has not yet raised any capital after the outbreak.
New Zealand:
The Reserve Bank of NZ is set to release credit card spending stats for the month of June today, which is a useful indicator of economic activity through looking at consumer spending habits. The market expects this figure to be at -21.1 per cent on June last year, when $3.2 billion was spent by NZ credit cards. A higher result may be a positive sign for the economy and may encourage a gain for affected stocks – and vice versa if the figure is lower than expectations. May's total spend of $2.8 billion was 20.3 per cent lower than May last year.
Australia: Nova Eye Medical go ex-dividend today. The dividend is A$0.135 to be paid on July 29, 2020. RBA meet monthly with their July policy minutes to be released today.
International: Chicago Fed national activity index - demonstrating overall economic activity and related inflationary pressure. Reporting: UBS Group, Capital One, Interactive broker, Synovus Financial, Lockheed Martin, Comerica Inc
For more information on the latest market moves, get in touch with Jarden.
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.
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