“People are waiting to see what the next round of inflation data looks like and the markets in the US have unwound the expectation of six rate cuts this year.
“It’s a bit of a reality check for the markets, which is a good thing. They were getting a bit overdone with the end-of-year rally,” said Solly.
Investors in the US are bracing this week for the consumer price and producer price indices and the start of the latest corporate earnings reporting season.
The US 10-year Treasury Note yield was slightly ahead at 4.019 per cent and the New Zealand 10-year Government Bond yield increased 6.1 basis points to $4.634 per cent.
There was mixed news on the economic front. Annual growth in total New Zealand spending eased to 2.5 per cent from 2.6 per cent, with durables and clothing remaining weak and utilities and miscellaneous spending growing faster than other categories.
ANZ Research said spending last month on car rentals was considerably stronger than the previous December, and there was double-digit growth at tourist attractions but spending at travel agencies and tour operators continues to fall.
The ANZ World Commodity Price Index increased 2.4 per cent in December, ending the full year down 1.8 per cent. In New Zealand dollar terms, the index lifted 1.9 per cent compared with November as the dollar gained 2.4 per cent against the trade weighted index.
Dairy prices improved, especially for butter, cheese and whole milk powder, to drive the index higher, more than offsetting weaker aluminium prices. Global shipping prices are once more trending higher, eroding exporters’ margins.
ANZ said in-market pricing in China for logs was improving as tighter supplies generate greater urgency from buyers. Local DIY activity has picked up but building consents remain low, signalling slow overall demand in the months ahead, the bank said.
The meat and fibre index gained 0.6 per cent in December but beef prices are under downward pressure due to strong global supply.
At home, interest rate-sensitive energy stocks were weaker, with Meridian down 7c to $5.64; Mercury falling 16c or 2.38 per cent to $6.55; Contact decreasing 9c to $8; and Vector declining 5c to $3.74.
Fisher & Paykel Healthcare was down 36c to $23.74; Ebos Group declined 84c or 2.3 per cent to $35.71; Turners Automotive decreased 9c or 1.97 per cent to $4.48; Freightways gave up 22c or 2.55 per cent to $8.40; and kiwifruit company Seeka shed 10c or 3.7 per cent to $2.60.
Among the retirement village stocks, Ryman Healthcare increased 10c to $5.85; Summerset Group declined 9c to $10.77; and Oceania Healthcare was down 2c or 2.6 per cent to 75c.
Other decliners were Winton Land falling 10c or 3.57 per cent to $2.70; Vulcan Steel down 17c or 2.07 per cent to $8.06; Hallenstein Glasson decreasing 12c or 2.18 per cent to $5.38; Investore shedding 3c or 2.48 per cent to $1.18; and Precinct Properties down 3.5c or 2.71 per cent to $1.255.
Port of Tauranga was up 10c or 1.82 per cent to 5.60; Napier Port gained 7c or 2.92 per cent to $2.47; Vista Group improved 4c or 2.5 per cent to $1.64; Eroad added 2c or 2.22 per cent to 92c; and 2 Cheap Cars gained 2c or 2.5 per cent to 82c.
