Jarden Brief: US markets rise after Fed hike

Boeing's shares rose after the company reported a key Chinese carrier conducted successful test flights of its 737 Max. Photo / AP

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

International
US

All major US markets were in the green. The S&P 500 was up 1.1 per cent, the Nasdaq jumped 2 per cent and the Dow Jones Industrial Average rose 0.7 per cent.

The sectors were mixed with consumer discretionary and communication services leading the pack, up 2.5 and 2.1 per cent respectively at the time of writing. Energy was the largest underperformer, down 1.2 per cent.

Boeing led the S&P 500 with an 8 per cent increase to its share price at the time of writing. This followed its company report showing a key Chinese carrier conducted successful test flights of Boeing's 737 Max. This may allow Boeing to re-enter one of the world's largest aircraft markets.

Netflix was close behind with a 7.9 per cent gain after announcing they will release their second 2022 financial results on July 19.

Constellation Energy Corporation closed out the top three performers, up 6.8 per cent. This brought Constellation Energy up 37.9 per cent year to date.

Specialty chemicals company Albemarie Corporation had underperformed the most at the time of writing, down 3.6 per cent.

Marathon Petroleum also underperformed with a 3.5 per cent decrease to its share price. This followed the US President Joe Biden demanding an explanation on why oil refining companies are not putting more gasoline into the market while posting record high profits.

Rounding out the bottom three performers was fuel and energy company Valero, down 3.7 per cent, which may have been affected by the President's comments.

The US Federal Reserve met earlier today to discuss the federal funds rate. This followed the release of the US consumer price index figures that showed annual inflation sitting at 8.6 per cent. A 75-basis point increase was announced, the biggest increase to the fed funds rate since 1994.

Rest of the World

Asian markets continue to have mixed performance with the Shanghai Composite and the Hang Seng in the green, up 0.5 and 1.1 per cent respectively. On the other hand, the Nikkei dropped 1.1 per cent.

All European markets found gains at the time of writing. The FTSE was up 1.2 per cent while the DAX and the CAC increased 1.4 per cent

The Eurozone posted a record trade deficit at 32.4 billion euros. This was largely driven by the increased cost to energy imports and represents the sixth consecutive month where the Eurozone had a trade deficit in goods.

Commodities

WTI Crude Oil fell a further 1.5 per cent to US$117.15 a barrel while natural gas bounced back with a 6.0 per cent increase.

Gold found a small gain, up 0.3 per cent to US$1,819.6 an ounce.

The US 10-Year Treasury rate declined for the first time this week, down seven basis points to 3.414 per cent at the time of writing.

Additionally, it was another day of sharp declines in the cryptocurrency market with Bitcoin down 7.9 per cent and Ethereum with an 11.1 per cent drop.

New Zealand

The NZX 50 remained in the red yesterday, dropping 0.1 per cent to 10,635.9 points.

Agribusiness company Scales Corporation was the top performing stock of the index yesterday, gaining 4.8 per cent.

KMD Brands recovered 3.8 per cent following the previous trading session's negative performance. Rounding out the index's top movers was electricity company Mercury NZ, advancing 2.6 per cent, rebounding from Monday's loss. These movements do not appear to relate to any news.

The biggest underperformer of the index was electricity generator and renewables developer Manawa Energy, declining 4 per cent. The company's dividend payment date is this Friday 17 June.

Closing out yesterday's bottom movers was cinema technology company Vista Group International and global tourism operator Tourism Holdings, falling 3.1 per cent and 3 per cent, respectively.

The March 2022 quarter current account results were released yesterday, the data indicated the deficit expanded to $8.5 billion (seasonally-adjusted).

There was a $1.9 billion increase that can be attributed to the rise in value of imported goods and fall in value of exported services when comparing to the previous quarter. The current account deficit for the year-end March 2022 now totals 6.5 per cent of gross domestic product at $23.3 billion, a 0.7 per cent increase on the December 2021 quarter.

New Zealand's first quarter 2022 GDP results will be published today.

Australia

The ASX 200 dipped 1.3 per cent yesterday to set a new 52-week low.

All 11 sectors closed in the red again. Information technology dropped 3.1 per cent and Australian real estate investment trusts (A-REIT) decreased 2.9 per cent. The best performing sectors were telecommunications services and consumer staples, down 0.2 and 0.6 per cent respectively.

Medical devices company Polynovo was the top performer for the second day in a row, up 4.8 per cent. Mining company Lynas Rare Earths rose 4.2 per cent. This follows their announcement on Tuesday that they had been awarded a US$120 million contract to build a commercial heavy rare earth separation facility in the United States. Finance, insurance and banking company Suncorp rounded out the top movers with an increase of 3.5 per cent.

On the flip side, Novonix was the biggest underperformer, down 13.6 per cent. The battery materials and technology company announced on Tuesday a notice of change of interests of substantial holder, with St Baker Energy Innovation Trust selling 7.6 million ordinary shares in an off-market transfer for an average price of A$2.90.

Information technology company Megaport decreased 11.1 per cent and gold miner Chalice Mining appeared in the bottom movers for the second day in a row with a decline of 8.7 per cent.

The Australian Bureau of Statistics published its April Overseas Arrivals and Departures data which saw 579,930 arrivals (a monthly increase of 199,310) and 606,710 departures (a monthly increase of 271,470).

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

Jarden is advising Tourism Holdings Limited on an agreement to merge with Apollo Tourism and Leisure Limited.

Disclaimer: The Jarden Brief is provided for general information purposes only. It reflects views and research available 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. The Jarden 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 financial advice disclosure statement is available free of charge at https://www.jarden.co.nz/our-services/wealth-management/financial-advice-provider-disclosure-statement/ Full disclaimer available at: https://www.jarden.co.nz/wealth-sales-and-research-disclaimer