Keeping you up to date with the latest market moves, in association with Investment firm Jarden
NZX Market Wrap-up: NZ tech stocks fall after global tech sell-off; telecoms rally continues
The NZX 50 Index finished up 0.5 per cent yesterday off the back of communications services stocks Chorus (+3.9 per cent) and Spark (+2.2 per cent) continuing yesterday's rallies.
However, tech stocks were pummelled as NZX investors joined a global sell-off of the sector. Pushpay (-8.4 per cent), Gentrack (-7.4 per cent), Vista Group (-6.3 per cent) and Plexure (-5.0 per cent) led the decline. EROAD and travel company Serko fared better, losing less than 1 per cent.
Kiwi payrolls company Paysauce was the only sizeable company up after its first quarter 2020 results, which highlighted total recurring revenue up 54 per cent to $449,000 compared to last year, as well as its total number of clients up 41 per cent to 2824.
Despite the positive result, Paysauce was not immune to the sell-off, being up more than 13 per cent at lunchtime and closing a modest 2.2 per cent in the green.
SkyCity breaks its downward trend
SkyCity finished up 3.4 per cent yesterday at $2.47, after a few consecutive days of declines. The transtasman casino operator was also reported applying for an extension to the Government wage subsidy yesterday, as it has experienced at least a 40 per cent decline in revenue over the past 40 days. Although its main New Zealand casino operations have performed well post-lockdown, other segments, such as the group's hospitality operations, have struggled.
Pushpay drops after largest single investor sells down shares
The share price of Kiwi donation solutions company Pushpay plummeted by 8.4 per cent yesterday after its biggest single shareholder, the Huljich family, sold a quarter of their shares overnight to institutional investors.
The 14.4 million shares were sold through investment banks JP Morgan Australia and UBS New Zealand at a minimum price of NZ$8.40, a 9.1 per cent discount to its prior closing price.
The family last disclosed a 22 per cent stake in the company worth $530 million, and the sale has reduced this holding to 15.7 per cent. The family may view its shares as overvalued and be cashing in at an opportune time.
Arvida Group reports sales down in the first quarter of 2021
NZX-listed retirement village operator Arvida has released a sales update reporting 32 resales and 12 new sales of its units in the first quarter of 2021, compared to 56 resales and five new sales in the same period last year.
The company noted "encouraging" recovery in May. Underlying its optimism, overall gains from settlements were up to $5m, compared to $4.8m last year, despite less sales occurring.
Job ads up on last month but down on comparable period
The recently released BNZ/SEEK employment report shows that although June Job listings were up 46.9 per cent on May, they are still down 38.9 per cent on June 2019.
The numbers bear out some recovery after Covid-19 headwinds. It is key to remember that this is in a period where many businesses are being kept afloat by government stimulus.
The government has recently announced another $40m addition to the Covid-19 response and recovery fund, this support will eventually end.
Rocky economic times could yet lie ahead if the government runs out of fiscal ammunition.
International Market Wrap-Up: Slow start due to tech sector slide
At time of writing, Dow Jones is up (1.7 per cent), S&P 500 is up (0.85 per cent) and Nasdaq is up slightly (0.3 per cent) despite being negative early, as tech stocks were sold off further.
The tech sector in America has had a great run since the March 23 low, up (60 per cent), leading to more than 72 per cent of fund managers to now exert a more "cautious" approach, as they believe it is very overcrowded.
The last two-day slide represents some of this sentiment reaching investors as they sell off to lock in some of the gains made.
JP Morgan & Chase beat market expectations with revenue of US$33.83 billion vs US$30.57 billion expected and earnings per share of US$1.38 vs US$1.01 expected.
Trading revenues were up 79 per cent, fixed-income soared 99 per cent and equity trading revenue was up 38 per cent, all on a year-on-year basis.
However, net income dropped significantly by 51 per cent because of setting aside US$9 billion of credit reserves for Covid-19. At time of writing the company's stock was up 0.2 per cent.
Wells Fargo posted its first quarterly loss (US$2.6 billion) since the Great Financial Recession as the bank put away US$8.4 billion of reserves for Covid-19.
The loss was greater than market expectations, with loss per share of US 66 cents vs expectations of US$0.20. On the back of this, the struggling bank also cut dividends to US$0.10.
At time of writing the company's stock was down 5.2 per cent.
In economic news the US budget deficit blew to an all-time high of US$864 billion, and the US consumer price index rebounded up 0.6 per cent from last month due to a Gasoline and food boost.
At time of writing WTI Oil was up 0.35 per cent to US$40.24 a barrel. Gold was flat at US $1810 per ounce. The US 10-year treasury was down (0.0028 basis points) to 0.612.
ASX Market Wrap-up: Tech stocks plummet as the S&P/ASX 200 takes a hit
Tech stocks led the S&P/ASX200 into a slump yesterday, as the index fell 0.6 per cent to 5941.1 points. Recent frontrunner, Afterpay, dived 7.2 per cent to A$66.55, at times breaching the A$66 mark at which its recent capital raise was completed. Biopharmaceutical company Mesoblast was the worst performer on the day falling 7.5 per cent. The stocks of the day were debt buyer Credit Corp Group, and household appliance manufacturer Breville Group, climbing 6.7 and 5.5 per cent to A$16.29 and A$24.24 respectively.
Australian items of interest
Qantas extends its share purchase plan for an additional two weeks, after its announcement it would halt international flights until March next year. Flights to NZ are now unavailable until September 1.
Electronic design company Altium release solid earnings figures of US$189m amid Covid-19, albeit solid only in light of downgraded guidance. Unaudited figures were above analyst consensus figures.
Blackmores hovers near its May placement price of A$72.50, closing the day at A$72.68 as it breached the placement price earlier in the session. It reached highs on June 2 of A$85.74.
Iron ore exports to China rose 35.3 per cent in June compared with the same month a year earlier. Iron ore is Australia's largest export to China, and demand is expected to remain strong until mid-2021 as Brazil struggles with a shortage of supply.
Westpac releases Consumer Confidence data today after mixed results yesterday out of ANZ and NAB. HIA New Home Sales also announced today, last month's result was -4.2 per cent.
UnitedHealth Group Inc, Goldman Sachs Group, US Bancorp and Bank of New York will report second quarter earnings in pre-market tomorrow.
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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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