Jarden Brief: Why bitcoin investors are keeping a close eye on India

Moves in India could have a big impact on the bitcoin market. Photo / Getty Images

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

New Zealand:

The NZX50 recovered from Monday's session with a 1.1 per cent gain. Healthcare was the best performing sector yesterday, up 2.6 per cent. Consumer non-cyclicals also drove the gains, rising 1.7 per cent.

The energy sector and consumer cyclicals sector fell 1.1 and 0.5 per cent, respectively.
Fisher & Paykel Healthcare was the top-performing stock on the NZX50 yesterday, after being Monday's worst-performing company, up 3.8 per cent.

A2 Milk Company was another outperformer, up 3.7 per cent at the end of the session. This comes after a new North American, Purdue University, scientific study suggests that A2 milk may cause fewer symptoms of lactose intolerance. A positive development for the dairy company which relies on this point of difference.

Church payments provider - Pushpay Holdings - fell 2.0 per cent. Another underperformer was SKY Network Television, down 1.7 per cent.

Comvita updated its Full-year guidance. With strong growth in China and North America, digital now accounting for over 30% of sales and efficiencies in costs and production, the full-year 2021 revenue range has been changed from $20-$23 million to $22.5-$25.5 million. Investors will welcome this update.

The New Zealand Institute of Economic Research's Quarterly Survey of Business Opinion (QSBO) was released yesterday. Key points were that a net 11 per cent of businesses are expecting economic conditions to decline in the coming months, improving from 16 per cent in the previous quarter. A net 8 per cent of businesses raised prices in the past quarter compared to a net 2 per cent of businesses reducing prices in the quarter before. A net 8 per cent of business' increased staff, with a net 18 per cent planning to hire in the current quarter.

Retail Card Spending data was also released which outlines New Zealand's spending on all credit, debit and charge card transactions within New Zealand. Retail industries spending rose 0.9 per cent for the month, up by $53 million. This worked to reduce the overall decline in retail spending in the March quarter, with retail industries spending declining 1.9 per cent, down $330 million.

INTERNATIONAL:
US Markets

US Markets traded up this morning as investors await the start of the first quarter reporting season. The S&P 500 increased 0.3 per cent, the Nasdaq up 0.9 per cent and the Dow Jones Industrial Average was down 0.2 per cent respectively.

At the time of writing, the leading sectors were Utilities and Consumer Cyclicals making gains of 1.2 and 0.9 per cent respectively.

For the second day in a row, electric car maker Tesla Inc led the way with a strong performance so far this morning, up 7.5 per cent at the time of writing despite significant short interest mounting against the company.

Similarly, multi-product manufacturer Danaher Corp extended gains of 3.4 per cent after releasing its first-quarter earnings forecast.

On the flip side, Financials (down 0.9 per cent) and Consumer non-Cyclical's (down 0.4 per cent) were the laggard sectors at the time of writing.

Weighing down index performance so far are today's single stock losers, investments company Franklin Resources Inc and cyber safety business NortonLifeLock Inc. Franklin traded favourably after releasing updated net asset values for its variety of funds yesterday evening.

Tech giant Microsoft Corporation made headlines on Tuesday as details surface of a potential acquisition of artificial intelligence company Nuance Communications. Nuance is said to be valued in excess of US$16 billion, and Microsoft views its voice recognition technology as complementary to its suite of product offerings. Nuance is currently listed on the Nasdaq at USD$ 52.2 per share and a market cap USD$15 billion, the stock jumped close to 15 per cent yesterday after the recent takeover rumours.

Microsoft is valued at USD$258 per share, with a market cap of over USD$1.7 trillion.

Asian Markets

The main Asian indices were a mixed bag at the time of writing, the Shenzhen traded down a slim 0.1 per cent, the Shanghai Composite slipped 0.5 per cent, and the Nikkei made a gain of 0.7 per cent.

Commodities

Among commonly tracked commodities, gold increased to US$1,745.9 per ounce. Cryptocurrencies soared with Bitcoin up 4.5 per cent to US$62,690.3 and Ethereum 6.4 per cent to US$2,278.4.

Crypto movements have been heavily dependent on developments in India, where the local Government in Mumbai have been toying with the idea of completely banning, or at least highly regulating, investment in all digital currencies including bitcoin. The idea was first floated in 2018 when the Reserve Bank of India (RBI) introduced measures to stop Indian financial institutions dealing with anyone involved in crypto trade, and it was also speculated to go as far as enforcing all Indian crypto holders to liquidate their position.

The RBI cites reasons such as cryptocurrencies having a potential to aid illicit activities such as terrorist financing but have yet to confirm what action they will take in 2021.
To round off commodities, WTI Crude oil increased 0.6 per cent to US$60.38 per barrel. US 10-year treasury yields remain stable at 1.63 per cent.

Australian Markets:

Over the course of Tuesday's session, the ASX200 was following a downward trend, but rebounded slightly at the end of the day. It closed 0.1 per cent below the previous close.
The strongest sector of the day was Information Technology, rising 2.0 per cent. On the flipside, the Utilities sector decreased by 1.5 per cent.

A definite winner of the day was buy-now-pay-later company Zip Co, shooting up 16.9 per cent to A$9.73. The firm released its very strong quarterly results for the period ending 31 March 2021. The group's quarterly revenue was up 80.0 per cent year-on-year and amounted to A$114 million. The Company's transaction volume was worth A$1.6 billion, a 114.0 per cent improvement year-on-year.

Recycling and waste management firm Bingo Industries was another winner, increasing 10.5 per cent to A$3.36.

Mining services group Perenti Global booked the biggest loss of the day, decreasing 4.0 per cent, despite the announcement on Monday, that its subsidiary African Underground Mining Services has secured a A$235 million contract. Construction and mining company Cimic Group, which declined 3.1 per cent, also underperformed.

Exchange-traded funds (ETFs) have made huge gains in the Australian market, surpassing a total value A$100 billion. Especially with the emergence of more environmentally conscious and socially responsible investors, ETFs have been able to cater for those values while offering diversification. Some predict the industry will grow a further 25.0 per cent before the end of this year.

Yesterday, the National Australia Bank published results for its March survey of business conditions, reaching a record high. The economic recovery is going strong, and businesses seem confident that it will keep improving. All states and industries were in positive territory regarding activity and capacity utilisation, apart from recreation and personal services, which still suffer under pandemic implications.

Later today, Westpac will release its results for April about Consumer Confidence.

• 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