Jarden Brief: ANZ's staggering prediction on house prices in Australia

ANZ has increased its projection for property price inflation in the next year. Photo / Getty Images

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

New Zealand

The NZX 50 closed Thursday's session slightly up, increasing 0.2 per cent.
Consumer cyclicals made gains again, increasing 1.7 per cent, while consumer non-cyclicals made the biggest losses, down 2.2 per cent.

The best performing stocks of the day were construction company Fletcher Building and real estate firm Kiwi Property group, increasing 3.3 per cent to $6.92 and 2.9 per cent to $1.25, respectively. They were joined by Goodman Property Trust (+1.6 per cent to $2.23) and Stride Property (+1.4 per cent to $2.19), which recovered following yesterday's rout.

Kiwi Property released a portfolio valuation update midday yesterday increasing its gains. The draft portfolio valuation said the company portfolio's overall fair value gain for the 2021 financial year would be approximately $110 million and the outlook has improved significantly, supported by vaccination rollouts. In total, Kiwi Property's various properties would be worth $3.3 billion following confirmation of the asset valuation at the end of the year.

The worst performers on Thursday were Synlait Milk, decreasing 4.2 per cent to $3.45, EBOS Group, down 2.4 per cent to $28.50, and Scales Corporation, down 2.2 per cent to $4.48.

The Warehouse Group recorded its best-ever first half profit yesterday, driving up the share price by 3.6 per cent to $3.78. The group brought in $55 million for the half, up 88.5 per cent compared to the previous corresponding period. There will be an interim dividend of 13 cents per share to be paid on the 22 April.

Yesterday, mobile phone company 2degrees Mobile said that it was looking into a possible IPO on both the NZX and ASX by the end of this year. 2degrees is owned by Trilogy International Partners, which is listed on the Toronto Stock exchange. Primary capital may be raised to accelerate growth initiatives at 2degrees, as well as enable Trilogy to reduce the debt it incurred while building the business. Exploring the listing is not surprising; 2degrees is performing well vs industry, and Trilogy has substantial debt maturing in 2022.

INTERNATIONAL
US Markets

In the US the S&P 500 was up 0.1 per cent, the DJIA was up 0.2 per cent and the NASDAQ had fallen 0.2 per cent this morning, at the time of writing.

The best performing sector of the day was Utilities, rising 1.0 per cent. Energy, yesterday's best performing sector, was the worst performing sector today and had decreased 0.6 per cent.

Darden Restaurants, owner of chains such as Olive Garden, was the top performer of the day today, gaining 6.8 per cent following the release of an earnings announcement which exceeded expectations. Expedia Group rose 4.3 per cent today, making it the second-best performer of the day.

The stock performing the worst overnight was Viacom, for the second day in a row, which fell 6.0 per cent after yesterday's share offering announcement. Short-squeezed
Discovery Channel was the second worst performer of the day again, which had fallen 5.4 per cent at the time of writing.

Approximately 127 million of the US$1400 stimulus checks have been sent.

Asian Markets:

Of the Asian markets the Shanghai index was down 0.1 per cent, the Nikkei rose 1.1 per cent, and the Hangseng fell 0.1 per cent.

Commodities:

Gold decreased in price today by 0.4 per cent to US$1726.10 per ounce. Bitcoin fell 6.1 per cent and Ethereum decreased 2.5 per cent.

Elon Musk announced yesterday that payment for a Tesla car can now be made in Bitcoin, which saw Bitcoin jump on the announcement and then track downwards.

Oil lost yesterday's gain, falling 5.1 per cent to US$58.11 a barrel. Brent oil fell 4.1 per cent to US$61.74 a barrel.

Affecting international trade is a 400m container ship blocking the Suez Canal in Egypt could take weeks to clear. This is preventing all ships entering the Canal in what is a major transport route. Around 206 large container ships, many of them carrying oil, gas and grain cannot pass through and are waiting at either side. This saw the price of oil rise yesterday with transport problems creating reduced supply. However, Europe's current Covid-19 decline has seen international optimism about the international recovery diminish, which has offset yesterday's gains.

Lastly, US 10-year Treasury yields rose slightly today, up 0.02 per cent, yielding 1.64 per cent.

Australia

The ASX finished the day's trading up a slim 0.2 per cent, buoyed by strong sector performance in Academic and Education Services, as well as Healthcare which nudged forward 1.0 and 0.7 per cent, respectively.

Materials company Adbri Ltd led the market up after a board member announced the purchase of a significant amount of company shares yesterday, which coincided with the company disclosing the size and timing of its final dividend.

Meanwhile, medical services provider Polynovo Ltd climbed 4.9 per cent with investors reacting favourably to Polynovo signing a purchase agreement with a new customer for supply of its products.

Technology and Industrials were the worst performing sectors, down 0.3 and 0.2 per cent, respectively.

Three days of extreme volatility continued for recent ASX listee Airtasker ltd. The Jarden Brief previously mentioned the stock jumped 61.5 per cent at its Tuesday IPO. Since then, it climbed close to 170 per cent above original list value on Wednesday, before falling 22.9 per cent in absolute terms on Thursday. Investors are expecting a prolonged period of price shifting as the market quickly gets to grip with the company's valuation and should be one to watch over the coming days.

Another underperformer yesterday was gold miner Resolute Mining Ltd which retreated a whopping 26.2 per cent. The slump was due to a termination of one of their mining leases on Wednesday, which led to a sell down from multiple significant investors yesterday.

In other news, ANZ recently released its forecast for Australian house price inflation, increasing its per annum growth expectation to 17 per cent from 9 per cent nationwide. Territory and city projections also included significant increases for Sydney and Perth at 19 per cent each.

Market commentators have noted that if these forecasts were to come to fruition, we could expect material intervention from the Australian Government similar to the likes of what we have seen in New Zealand this week.

• 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