Keeping you up to date with the latest market moves, in association with Investment firm Jarden.
International
US
All American indices had dropped at the time of writing, with the Dow Jones Industrial Index
Keeping you up to date with the latest market moves, in association with Investment firm Jarden.
International
US
All American indices had dropped at the time of writing, with the Dow Jones Industrial Index losing 1.0 per cent and the S&P 500 down 1.1 per cent.
Apple shares fell 2.0 per cent on news that Zhengzhou, Apple’s main manufacturing hub, is estimated to produce a shortfall of six million iPhone Pro units this year.
This is due to civil unrest in China (more below), where facility operators race to get workers back to the assembly line.
The situation is well exposed, as further lockdowns could cause further roadblocks in volumes.
Apple and Foxconn have increased their estimates for this shortfall, expecting the six million units in lost output to come through in 2023.
This loss in production would see them missing out ahead of the peak holiday season.
Black Friday sales in the United States were reported to be a record US$9.12 billion, where Adobe analytics showed that online sales on the day after Thanksgiving grew 2.3 per cent over the previous year.
Cyber Monday sales fell 1.4 per cent over the previous year due to earlier markups in the month as retailers manage their inventory levels amid widespread product shortages.
The average discount was expected to be greater than 30 per cent, over last year’s 28 per cent.
Electronics soared 221 per cent over the previous year in sales, leading all categories by a significant proportion. Toys and exercise equipment performed well on Black Friday as well, seeing an increase over the same period of 285 and 218 per cent respectively.
Rest of World
There have been reports of political protests over the weekend in at least 10 cities in China, including Beijing, Shanghai and Wuhan - in retaliation for the prolonged and strict Covid-19 controls in place by Xi Jingping’s government.
The breaking point for these protests seems to have been a deadly apartment fire in Xinjiang, with the lethality attributable to these restrictions in place.
Most of the protests had been stamped out by Monday, ranging from marching street protests in Wuhan to peaceful demonstrations by students in Beijing. Demonstrations even spread to Hong Kong. Reports are that police presence remains heavy in major cities in China.
Commodities
Bitcoin was down by 2.0 per cent at the time of writing after news of Crypto lender BlockFi filing for Chapter 11 bankruptcy.
BlockFi had been bailed out earlier in the year by Sam Bankman-Fried after it suffered losses on loans when hedge fund Three Arrows Capital collapsed. The lender had assets and liabilities of US$1 to US$10 billion with more than 100,000 creditors.
It was the third week of oil prices depreciating, at the time of writing, with oil falling 0.2 per cent.
Protests in China have furthered the bearish sentiment in oil production and sources with a lack of clear signs from oil producers to further cut output, given uncertain demand for energy and oil in China.
Australia
Healthcare company Healius provided a second trading update for the four months into FY23, saying revenue from taxpayer-funded Covid-19 tests was down 85.4 per cent compared to the four months ending October last year.
Rival Sonic Healthcare revealed a similar trend two weeks ago, with its revenue down 64.8 per cent for the same period.
Due to this, guidance previously given by Healius for FY23 at the AGM (held one month ago) had been retracted. Earnings before interest, tax and depreciation put Healius 500 basis points below Visible Alpha analyst consensus estimates for 1H23.
The shift in demand has caused distress for investors, showing a drop in share price of 10.1 per cent at close.
Management stated it is managing the cost base to address this, with collections now being undertaken in the core facilities and in only four Covid dedicated drive-throughs.
The Australian Bureau of Statistics revealed that retail sales fell 0.2 per cent in October over the previous month, the first decrease in Australia for 2022.
Sales fell across all industries with food retailing the exception, growing 0.4 per cent.
The largest decrease was in department store retailing, followed by clothing, footwear & apparel, which showed decreases of 2.4 and 0.6 per cent respectively.
This month precedes the key month of November for retailers, where Gerry Harvey (executive chairman of retail chain Harvey Norman) said on Sunday the chain set a record in sales which continued over the weekend in the lead up to the first Christmas in three years where people were going to be able to get together.
New Zealand
Real estate investment trust Kiwi Property Group presented NZ$100 million of net rental income as part of its 1H23 result, up 6.3 per cent.
This record high was due to a strong performance from key asset Sylvia Park, where sales also saw an increase over the prior year of 9.6 per cent to NZ$1.51 billion and year-to-date foot traffic is now in-line with pre-pandemic levels.
Management also announced the sale of office asset 44 The Terrace in Wellington for NZ$48 million and that its Westgate Lifestyle is being held for sale (NZ$94.6 million book value at FY22), reducing gearing from 35.7 to 32.0 per cent.
Despite worsening economic conditions, FY23 dividend of 5.7 cents per share has been confirmed along with news that Office 2 at Sylvia Park has approximately 66 per cent of its office space committed or in advance negotiations (FY22: 30 per cent) and is on track to complete in the first quarter of 2023.
Retirement operators have seen a boost in their share price at close after the New Zealand government announced it will spend NZ$200 million per year to boost wages for nurses working in aged care in 2023.
This will help provide support for care margins which have been under pressure. The pass-through of this benefit will be limited given the sector’s requirement to pay at-market in what has been a tight market for labour.
Coming up today
Investors are anticipating what will be a crowded day of results.
Major appliances manufacturer Fisher & Paykel Healthcare, retirement operator Arvida Group, glass supplier and manufacturer Metro Performance Glass and real estate investment trust Asset Plus are the companies expected to release 1H23 results, with software company Gentrack to provide full year earnings for the financial year ended September.
Australia is set to have a quiet day in comparison, with restaurant company Collins Food the only company in the ASX 200 to have a result to announce (1H23). Two AGMs – for Ramsay Health Care and Lynas Rare Earths - are to be held today.
For more information on the latest market moves, get in touch with Jarden.
All market pricing and announcements are sourced from Refinitiv, NZX and ASX.
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