US President has unveiled a range of major policies. Photo / AP
Keeping you up to date with the latest market moves, in association with Investment firm Jarden
New Zealand
The NZX50 closed Wednesday's session slightly higher at 12,646.14 points (+0.2 per cent).
Financial and healthcare stocks were leading on the day, increasing 0.9 and 0.7 per cent, respectively, while energy (-0.8 per cent) and utilities (-0.8 per cent) underperformed.
Skellerup Holdings (+4.5 per cent), producer of industrial and agricultural rubber products, continued its upward rally and booked the biggest gains of the session, closing at $4.64. Vista Group International was next in line, rising 3.1 per cent to $2.30.
Yesterday, the film software developer notified the market of its annual shareholder meeting, which is set for 26th May and will be held online. Rounding off the top performers was outdoor retailer, Kathmandu Holdings, increasing 2.9 per cent to $1.41.
The biggest loser of the day was generator retailer Genesis Energy, down 2.6 per cent to $3.36, followed by church donations platform, Pushpay Holdings, decreasing 2.2 per cent to $1.81. Another underperformer was energy retailer Meridian Energy, closing 1.5 per cent lower at $5.41.
Tuesday's best performer, NZX Limited, corrected some of the gains, decreasing 1.4 per cent to $2.07.
There has been a trend of exporters facing difficult food safety audits from China. Sanford has already faced an export halt for seafood and now meat exporters are nervous that they might have to face similar procedures. Tougher regulations have ostensibly been implemented to curb the pandemic. New Zealand exporters are arguing that they comply with the New Zealand rules, as there are no community cases in the country.
INTERNATIONAL
US Markets
At the time of writing, the US markets were in the red. The S&P 500 was flat, the Nasdaq was down 0.4 per cent and the Dow Jones Industrial Average fell 0.1 per cent.
The top performing sectors of the S&P500 were Energy and Communication Services, which rose a strong 3.3 and 1.8 per cent, respectively.
The best performing stock was Nov Inc, which rose 9.1 per cent. The oilfield equipment manufacturer has seen increased demand as production ramps up to meet higher oil prices. Devon Energy was another outperformer, gaining 8.4 per cent.
The sectors underperforming the most at the time of writing were Technology and Healthcare, falling a respective 0.9 and 3.3 per cent.
Enphase Energy fell 13.9 per cent after they released Q1 results which exceeded forecasts, although Q2 guidance indicated production capacity will be impacted by the shortage of semiconductor chips. Investors did not react favourably to this news. Software developer and provider, F5 Networks, another underperformer, decreased 10.0 per cent.
The Federal Open Market Committee outcome was released this morning. The Federal Reserve Rate remained unchanged, with economic employment and activity strengthening. Following this outcome, the S&P 500 jumped 0.3 per cent to an intraday record. The Committee's inflation target is moderately over 2 per cent for some time.
In other macroeconomic news, President Biden has raised the minimum wage to US$15 an hour for all federal contract workers in an executive order. This increases their existing minimum wage 37 per cent from US$10.95. This extends to workers with disabilities and is expected to affect hundreds of thousands of Americans.
Rest of world:
Asian indices were in the green. The Shanghai Composite rose 0.4 per cent, the Hang Seng was up 0.5 per cent and the Nikkei returned a gain of 0.2 per cent.
Caution in the Asian markets can currently be expected, with an eye on the quickly declining Covid situation in India.
Commodities:
Among the commonly tracked commodities, gold fell 0.2 per cent again to US$1,774.30 per ounce. Crypto currencies continued their recovery with Bitcoin up 0.2 per cent and Ethereum increasing 4.2 per cent.
The US 10-year bond currently yields 1.641 per cent.
Lastly, the oil price rose again, up 1.6 per cent, with WTI Crude Oil trading at US$63.93.
Australia
Australian equities were up yesterday as the S&P/ASX 200 gained 0.4 per cent to close at 7064 points.
Markets reacted to the release of first quarter Consumer Price Index (CPI) data, which showed prices rising 0.6 per cent higher than Q42020. Although prices are being driven by a commodities boom and a global economic recovery, the 0.6 per cent increase fell below expectations. The annual inflation rate was a record low at 1.1 per cent.
Economists were expecting a quarterly rate of around 0.9 per cent, with government subsidies in home building and education noted as reasons for prices rising less than anticipated.
A lower-than-expected CPI was not enough to weigh on sector gains of Real Estate and Energy, each leading the way with 1.5 and 1.1 per cent increases, respectively.
Overall, index movements were well supported by the single stock winner Downer Edi Ltd, advancing 7.3 per cent. The contractor recently announced it will undertake an on-market share buy-back of up to 70.1 million shares which will create liquidity and generate returns for shareholders.
Similarly, retail business Kogan.Com Ltd traded favourably (up 7.1 per cent) after the release of its 3rd quarter update was received well by investors.
On the other hand, markets were slowed by the Materials sector, which was the only sector to fall - down 1.0 per cent.
Single stock laggards were led by mining company Ramelius Resources Limited, which fell 9.8 per cent. The company released poor quarterly production statistics, with both historical Q1, and forecast Q2 production short of investor expectations.
Fellow gold miner St Barbara Ltd slipped 7.9 per cent after the release of its own quarterly production statistics.
Amongst the headlines was electronics retailer JB Hi-Fi, which yesterday announced its chief executive, Richard Murray, would be moving on at the end of August. Murray will be replaced by current chief operating officer Terry Smart. An outgoing member of senior management can cause a stir amongst investors who have faith in specific individuals.
News of the transition, in conjunction with a flat sales forecast, led to the stock sliding 4.0 per cent to now trade at A$45.60.
Coming up Today:
A spate of data reports is ahead for the US. First Quarter GDP, Pending home sales and Initial and Continuing jobless claims will be released. These figures should give investors some insight into the state of the US economy and the labour market. Labour market statistics will be key for the inflation narrative as slack therein is a key plank in the argument of those expecting only transitory inflation.
Woolworths (supermarkets) and Fortescue (iron mining and smelting) are among the well known Australian companies releasing quarterly reports.
For New Zealand, the government trade balance report and the ANZ business confidence report are set to be released.
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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>
The Kiwi is under pressure as the US dollar rises on expectation of higher interest rates.