New Amazon boss Andy Jassy. Photo / Getty Images
Keeping you up to date with the latest market moves, in association with Investment firm Jarden
New Zealand:
New Zealand markets traded in the red yesterday as the S&P/NZX 50 slid 0.4 per cent to 12,758.9 points.
New Zealand life insurance company, Fidelity Life, led the headlines after acquiring Westpac Bank's life insurance arm for $400m. The Australian bank had been looking to spin off part of its New Zealand insurance business, with Fidelity taking the opportunity.
Most of the funding will be sourced from current shareholder, The NZ Super Fund, and an investment from a new shareholder, Ngāi Tahu Holdings.
Leading sectors comprised of both energy and real estate, making gains of 1.1 and 0.6 per cent respectively.
Goodman Property trust traded favourably, with a strong performance to finish up 2.5 per cent ahead of the company's AGM on Wednesday. Similarly, electricity retailers Trustpower and Mercury Energy, finished up 2.4 and 2.1 per cent to round off Tuesday's single stock winners podium.
On the flip side, Industrials (down 1.5 per cent) and consumer non-cyclicals (down 1.0 per cent) were the laggard sectors of the day.
Auckland International Airport weighed down on index performance as the stock fell 3.15 per cent to offset some of Monday's gains after the company traded favourably in-line with a takeover offer for Sydney Airport. Joining the Airport was payment service platform Pushpay Holdings Ltd which continued downward momentum on Tuesday following the news that CFO Shane Sampson would be leaving the firm.
In other news, economists from ASB and BNZ are now forecasting interest rate hikes will begin in November. The change followed the latest NZIER Quarterly Survey of Business Opinion, which showed business sentiment for the June quarter well-above pre-COVID levels (and the historical average), labour shortages the worst they've been in the history of the survey - going back to 1976 - while cost and pricing pressures continue to rise.
INTERNATIONAL:
Unite States:
This morning the major US indices were all trading in the red, after setting new records last Friday. The S&P500 decreased 0.5 per cent, the NASDAQ was down 0.1 per cent, and the DJIA declined 0.9 per cent.
The consumer discretionary and real estate sectors were performing well, increasing 0.6 and 0.2 per cent, respectively. Energy and financials were booking the biggest losses, falling 2.9 and 1.7 per cent, respectively.
Amazon was the top performer of the day, rallying 4.6 per cent. This increase was brought on partly due to Andy Jassy taking over as CEO from Jeff Bezos at the start of this week.
Additionally, the Department of Defence (DOD) called off its US$10 billion Joint Enterprise Defense Infrastructure (JEDI) contract with Microsoft (-0.3 per cent).
The JEDI contract was intended to modernise the Pentagon's IT operations and was awarded to Microsoft back in 2019. Amazon Web Services, which was competing for the contract at the time, filed a lawsuit claiming the decision was influenced by Donald Trump's bias against Amazon. A report released by the Pentagon last year could not support these claims, but also stated that it had limited cooperation from the White House. Now, due to new requirements and industry advances, the Pentagon said the JEDI contract no longer meets its needs. The DOD announced a new contract known as the Joint Warfighter Cloud Capability, for which Amazon and Microsoft can submit proposals.
Next in line was power generation equipment manufacturer, Generac Holdings, gaining 4.0 per cent, hitting a new 52-week high. Rounding out the leader board was medical device producer Abiomed, up 2.9 per cent.
The worst performer, at the time of writing, was oil and natural gas company, Diamondback Energy, falling 6.2 per cent. Oil field service company Halliburton declined by 5.6 per cent, and oilfield equipment manufacturer Nov was down 5.5 per cent. The top decliners were all impacted by the drop in oil prices.
Rest of the World Markets:
The major Asian indices were mainly underperforming, only the Nikkei was booking gains, increasing 0.2 per cent. The Shanghai index decreased by 0.1 per cent, the Hang Seng was down 0.3 per cent, and the Shenzhen declined 0.4 per cent.
Commodities
At the time of writing, Gold increased by 0.7 per cent, trading at US$1,795.80 per ounce.
Oil retreated by 2.2 per cent to US$73.48.
Cryptocurrencies were a mixed bag. Bitcoin fell a further 0.6 per cent, while Ethereum gained 3.3 per cent.
The US 10-year treasury rate fell below 1.4 per cent for the first time since February, now yielding 1.377 per cent.
Australian Markets:
The ASX200 was in the red yesterday, closing 0.7 per cent lower, with nine of eleven sectors declining. This followed yesterday's release of the Reserve Bank of Australia's decision to maintain the cash rate at 0.1 per cent but slightly taper bond buying to AUS$4 billion per week until mid-November.
The fall was led by the telecommunications Services and health care sectors, down 2.0 and 1.9 per cent, respectively.
In the green was the energy sector, up 1.5 per cent.
Oil Search was the top-performing stock of the ASX200 yesterday, rising 4.6 per cent.
This share price rise was likely driven by the oil price rise the previous day as a result of OPEC called off talks on production outputs, with the largest exporters failing to agree on a supply increase. An oil supply increase internationally would likely reduce oil prices.
Whitehaven Coal rose 3.9 per cent. Rounding out the top three was real estate company Dexus, up 2.5 per cent. It released confirmation of the completion of the Simplification yesterday.
Healthcare services and equipment company Polynovo fell 8.8 per cent, the current Australian lockdown may be affecting elective surgeries in Australia. Appen declined by 6.2 per cent with The Capital Group Companies ceasing to be a substantial shareholder recently.
Ramelius Resources released their production report yesterday. Full-year gold production was 272,109 ounces, below the 275,000 to 280,000 guidance range, citing rainfall events and lockdown restrictions as barriers to achieving the targets. Investors responded unfavourably, pushing the stock down 5.4 per cent.
• 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-disclaimera>
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