AT&T announced it will be merging WarnerMedia with Discovery in a US$43 billion deal. Photo / Getty Images
Keeping you up to date with the latest market moves, in association with Investment firm Jarden
New Zealand
The S&P/NZX 50 traded up following a poor performance last week, with the index recovering 0.3 per cent to 12,411 points.
Leading the index performance were healthcare and technology stocks, making gains of 1.0 and 0.8 per cent, respectively.
Film software developer Vista Group Ltd led the way with a strong performance, up 5.7 per cent at yesterday's close following a sell off earlier in the month. Similarly, Restaurant Brands NZ Ltd jumped 5.1 per cent to $13.90 – a touch below its record highs.
On the flip side, consumer staples (-0.8 per cent) and utilities (-0.4 per cent) were the laggard sectors.
Weighing down index performance was single stock loser a2 Milk which traded down 4.5 per cent, continuing its downward momentum over the last two weeks following a profit downgrade and uncertain outlook provided by management.
Joining a2 Milk was aged care provider Oceania Healthcare, down 2.9 per cent. The company announced it would delay the release of its results for the 10 months period ending 31 March 2021.
Other news flow included the release of electricity company Trustpower's 2021 results, which may have direct implications on the potential sale of its retail operations. Trustpower performed within expected guidance range, producing full year earnings of $200.2 million.
Further, Tower Insurance announced a profit downgrade ahead of its results next week, stating net profit would be within the $25-$27m range rather than the previously guided $29.8m.
INTERNATIONAL
US
All three major US indices were in the red this morning. The S&P500 decreased 0.6 per cent, the NASDAQ was down 1.1 per cent, and the Dow Jones declined 0.4 per cent.
Energy and Materials were the best performing sectors at time of writing however, up 1.5 and 0.8 per cent, respectively. Information Technology and Communication Services booked the biggest losses, down 1.3 and 1.2 per cent, respectively.
Top gainers of the day were hard drive manufacturers Seagate Technology (+5.3 per cent) and Western Digital Corp (+4.9 per cent), both hitting 52-week highs.
Meanwhile, global media giant Discovery Inc fell 5.7 per cent after AT&T announced it will be merging WarnerMedia with Discovery in a US$43 billion deal – with Discovery shareholders to own 29 per cent of the new company. This merger will create a new entertainment giant which will own big channels such as CNN, HBO, HGTV and the Food Network. Commentators have noted its potential to being a valid competitor to the dominant streaming providers Netflix (-1.7 per cent) and Walt Disney (-2.8 per cent).
Media and technology company Comcast Corp (-5.3 per cent) and Tesla (-4.2 per cent) rounded out the worst performers.
Rest of the world
The popular Asian indices were generally up at time of writing. The Shanghai index (China) was up 0.8 per cent; the Shenzhen index (China) was up 1.2 per cent; the Nikkei 225 (Japan) was down 0.9 per cent; and the Hang Seng (Hong Kong) index was up 0.6 per cent.
Two Indonesian start-ups, Gojek and Tokopedia, have announced plans to merge and form the GoTo Group. The ride-hailing and payments firm and the e-commerce player are considering an IPO in the future, which is said to value the GoTo Group at US$35 to US$40 billion.
A potential travel bubble between Singapore and Hong Kong was meant to commence on 26 May 2021. Due to an uptake of community cases in Singapore, these plans have been delayed. Further updates will be announced on or before 13 June.
Ryanair (-2.4 per cent) reported its Q4 earnings for 2021 on Monday. The pandemic left the airline with a full-year net loss of €815 million. Travel levels were down 81 per cent for the year. The company stays optimistic, commenting that it saw an increase in bookings over the last month.
Commodities
Precious metals performed well, inverse to the big US indices. Gold rose 1.6 per cent to US$1,867.50 per ounce while silver climbed 3.5 per cent to US$28.32.
Oil was trading at US$66.21 a barrel, up 1.3 per cent.
The US 10-year treasury rate remained relatively unchanged, yielding 1.639 per cent.
Cryptocurrencies are facing selloffs across the board as environmental concerns regarding the energy usage of the mining process have become more prominent.
Ethereum decreased by 5.0 per cent to US$3,257.29, while Bitcoin (-4.8 per cent) was very volatile during Monday's session, dropping by more than 9 per cent after Elon Musk replied 'Indeed' to a follower's tweet that bitcoin holders would 'slap themselves next quarter' after finding out that Tesla had dumped its Bitcoin holdings.
Australia
The ASX200 was up 0.1 per cent yesterday. The slight gain was led by the Information Technology sector, up 1.2 per cent, as well as the Energy sector, up 1.1 per cent. On the other hand, the Utilities and Telecommunication Services sectors fell 1.9 and 1.0 per cent, respectively.
Mining companies Resolute Mining and Ramelius Resources were the top performers yesterday, up 7.8 per cent a piece. The rise was likely driven by the global increase in commodity prices.
Carsales.com lost 11.8 per cent yesterday after resuming trading following a trading halt last week. They announced the completion of a new share offer yesterday, raising A$428 million. Domestic institutional investors took up 99 per cent of their entitlements to the offer. The proceeds will be used to partially fund the acquisition of Trader Interactive for US$624 million.
Data company Nuix fell 9.5 per cent. This followed a joint investigation by The Sydney Morning Herald, The Age and The Australian Financial Review released yesterday which questioned Nuix's governance and financial accounts in the years before it floated. The report also detailed a failed coup of the CEO, which stemmed from internal concerns.
Nuix responded in a market release outlining that their "performance and market position are strong". The release of this investigation was responded to unfavourably by investors, with Nuix driven to a record low price.
Coming up Today:
Sylvia Park owner Kiwi Property Group will be releasing its full year earnings later today, followed by construction giant James Hardie, which is listed on the ASX.
Investors will also be looking to a raft of macro data which will be released overnight – including Japan and the Eurozone's first quarter GDP numbers. In the US, numbers on housing permits and starts will be interesting, given recent reports that home-buying sentiment has collapsed to its lowest levels since 1983.
• 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-disclaimera>
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