Jarden Brief: Disney jumps on good subscriber news, but tears for toymaker after poor holiday sales

Things were looking up for Disney overnight but some staff may not be sharing joyful feelings. Photo / AP

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

International

US

US markets were in the green at the time of writing, with the latest earnings announcements exceeding expectations.

The S&P 500 was up 0.1 per cent, the Nasdaq Composite rose 0.2 per cent and the Dow Jones Industrial Average had increased 0.3 per cent.

By sector, consumer discretionary and technology propped the market up, each increasing 1.2 per cent.

Walt Disney jumped more than 6.0 per cent then eased back to a 2.2 per cent gain after a result release showed the company lost fewer subscribers than expected.

Disney also beat earnings expectations. The CEO announced as part of cost-cutting and restructuring the company would be slashing 7,000 jobs.

Toymaker Mattel declined 10.3 per cent after its fourth quarter results missed expectations on declining holiday sales.

Both revenue and earnings per share disappointed against market consensus. Mattel appears to join the long list of companies being negatively impacted by worsening consumer sentiment and a declining retail environment.

Google’s parent Alphabet continued its decline from yesterday, down 5.4 per cent today at the time of writing.

Rest of the World

European stocks closed higher with the European Stoxx 600 index up 0.6 per cent and the FTSE 100 increasing 0.3 per cent as earning season wraps up in Europe.

Asian markets were mixed with the Hang Seng closing 1.6 per cent higher, the Shanghai Composite up 1.2 per cent and Nikkei losing a slim 0.1 per cent. Market rallies appear to be on sentiment of the potential for China to reopen.

Commodities

Brent Oil broke a winning streak, currently trading 1.0 per cent lower at US$84.30 a barrel, dipping in US trading as US oil reserves rise, while gold is trading down 0.1 per cent to US$1,874.50 per ounce.

The US 10-year Treasury bond has eased off two basis points to a yield of 3.61 per cent.

Bitcoin has fallen 1.7 per cent to US$22,567.00.

New Zealand

The NZX 50 Index declined 0.8 per cent yesterday.

Air New Zealand rose 1.9 per cent, Heartland Group increased 1.1 per cent and Genesis Energy gained 0.7 per cent as the top performers.

Mainfreight released a trading update. Revenue rose 17 per cent year on year while profit before tax increased 32 per cent.

Mainfreight noted that trading conditions from late December and into January have been more subdued compared to earlier in the financial year, especially across US and Asian businesses while Australia has continued to see increased profit and revenue performance. Mainfreight declined 3.0 per cent yesterday.

Tower provided a further update on the recent Auckland flooding and subsequent landsides from 27 January. To date, 3,600 Tower customers have lodged 4,810 policy claims.

Approximately 2,660 of these claims are for home insurance and around 740 are for motor with the balance mostly being contents insurance claims.

Tower CEO Blair Turnbull says Tower remains financially strong with robust reinsurance cover and a well-capitalised balance sheet. Tower declined 1.5 per cent.

The ANZ Truckometer showed a 0.7 per cent decline in the Light Traffic Index in January while the Heavy Traffic Index rose 0.8 per cent.

ANZ notes that variation in light traffic is generally a good indicator of consumers’ willingness to spend and this decline is consistent with the recent slowdown in retail indicators. NZ Card Spending – which is released today – should help to build a picture of current consumer spending in NZ.

Australia

The ASX 200 traded down 0.5 per cent following the release of some sizeable companies reporting below expectation results.

AGL Energy declined 10.3 per cent in its worst day since 2007. Reporting its interim financial year 2023 results underlying net profit after tax fell 55 per cent year-on-year which led to an AU$0.08 per share interim dividend (half what the energy provider paid for the same period in 2022).

The CEO said the result reflected the impact of various plant outages and closures.

Megaport lost 4.9 per cent. The network service provider also released its interim results yesterday which surprised to the downside.

Insurer Suncorp eased off 2.3 per cent following its result release on Wednesday.

Gold stocks in Australia declined 1.4 per cent yesterday despite prices of the precious metal increasing on Wednesday.

St Barbara lost 5.7 per cent, Newcrest Mining fell 1.5 per cent and Northern Star Resources declined 1.7 per cent.

Gold is sensitive to high interest rates in being a non-yielding asset class. The decline amongst gold companies in Australia may be a response to the RBA rising the cash rate earlier this week.

Coming up today

NZ has card spending, a Sanford Q1 Update and Hallenstein Glasson trading update out today.

In Australia the RBA Statement on Monetary Policy is released while REA Group and News Corp report earnings. UK Q4 GDP is announced and the China CPI/PPI is released.

For more information on the latest market moves, get in touch with Jarden.

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