Jarden Brief: Wipe out on Wall Street

Nasdaq was down 4.6 per cent and the Dow Jones Industrial Average fell 3.3 per cent. Photo / Getty Images

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

International

US

The major US indices were in the red at the time of writing. The S&P 500 had lost 3.8 per cent, the Nasdaq was down 4.6 per cent and the Dow Jones Industrial Average fell 3.3 per cent.

All sectors were also in the red. Consumer discretionary and consumer staples had the biggest losses, down 6.8 and 5.8 per cent respectively.

The highest performing stock in the S&P 500 yesterday was TJX Companies, up 7.3 per cent after releasing earnings that reportedly beat analysts' expectations.

Insurance company Assurant increased 1.0 per cent and entertainment company Electronic Arts rose 0.8 per cent.

Retailers swamped the top decliners of the S&P 500 this morning. Target had the largest loss, plummeting 27.4 per cent, hitting a new 52 week low of US$155.59. This follows the retailer reporting quarterly results that were lower than expected, after difficulties with inflation and inventory issues.

Discount store operator Dollar Tree dropped 15.8 per cent, potentially pulled down, alongside Costco (-13.0 per cent), by industry giants Target and Walmart's disappointing earnings reports.

Tractor Supply rounded out the underperformers, falling 13.9 per cent. The rural lifestyle retailer has lost 25 per cent for the year to date.

Walmart continued to fall, down 6.9 per cent to US$122.34, following Tuesday's worst single day performance since 1987.

Home improvement retailer Lowe's fell 6.6 per cent, reaching a new 52 week low of 179.75. This followed first quarter revenue results of US$23.7 billion, that hit below expectations of US$23.76 billion.

Rest of the World

Markets in Asia were mixed, with the Shanghai Composite down 0.3 per cent while the Nikkei and the Hang Seng increased 0.9 and 0.2 per cent respectively.

European Markets were in the red at the time of writing as UK inflation hit a 40-year high of 9 percent in April. The FTSE, the DAX and the CAC fell 1.1 per cent, 1.3 per cent and 1.2 per cent respectively.

Commodities

WTI Crude Oil dropped 2.6 per cent to US$109.57 per barrel.

Gold experienced a small loss of 0.2 per cent while silver fell 1.4 per cent.

The US 10-Year Treasury rate declined eight basis points down to 2.891 per cent.

The cryptocurrency market was largely in the red. Bitcoin and Ethereum fell 3.4 and 4.1 per cent respectively.

New Zealand

The NZX 50 performed well yesterday, closing 1.1 per cent up.

Meridian Energy was the best performer of the day, climbing 4.7 per cent. This may have been driven by Meridian releasing its April operating report, which showed a 3.1 per cent increase in sales volume amidst a 2.3 per cent decrease in national electricity demand compared to the same month last year.

Skellerup also closed in the green, up 4.0 per cent.

Pacific Edge rounds out the top three performers of the day after increasing 3.8 per cent. Year to date, Pacific Edge is still down 37.1 per cent.

EROAD fell 6.9 per cent. This brings the share price down to $2.57, 48.6 per cent down from the start of the year.

After reporting a loss of $31 million over its past financial year, Serko's stock price fell 4.3 per cent. This represents the biggest loss the company has had since it's NZX listing.

Vista Group is the final underperformer, down 1.8 per cent.

Argosy Property released its FY22 annual result, which showed the company had a net profit after tax of $236.2 million and an occupancy rate of 98.7 per cent. The share price closed 3.3 per cent up.

Australia

The ASX 200 closed at 7,182.70 points yesterday, a gain of 1.0 per cent.

Nine of the 11 sectors finished higher. Materials led the charge with a 2.5 per cent improvement. Information technology and Australian real estate investment trusts followed with 1.9 per cent gains a piece. Consumer staples (-1.0 per cent) and financials (-0.04 per cent) were the only sectors to underperform on the day.

Champion Iron was the top performer, rising 5.3 per cent. The iron ore company has agreed to purchase the Pointe Noire Iron Ore Pelletizing Facility in Quebec, Canada for C$2.5 million. The firm has also entered a memorandum of understanding with a "major international steelmaker" to explore the feasibility of re-commissioning the Pointe Noire pellet plant to produce direct reduction grade pellets.

Uranium producer Paladin Energy and mining & metals company South32 followed, each with a 5.2 per cent improvement.

Medical device company PolyNovo closed in the red (-4.6 per cent). Metal recycler Sims slipped 3.4 per cent.

Eagers Automotive dropped 3.3 per cent after the vehicle retailer updated the market on its year-to-date performance for the half year ending 30 June 2022. The company noted that orders have been robust – 25 per cent above 31 December 2021 levels.

However, Eagers expects new vehicle deliveries to customers to reduce in the first half of this year, as semiconductor shortages, Covid-19 restrictions in China and the conflict in Ukraine constrain vehicle supply. The automotive group expects underlying operating profit before tax from continuing operations to fall by between 12 and 15 per cent compared to a year ago. Net profit before tax is expected to be down between 10 and 16 per cent.

Australian Bureau of Statistics (ABS) data for the March 2022 quarter revealed a 0.7 per cent quarterly increase in seasonally adjusted wages. Annual wages increased 2.4 per cent - the highest rate since December 2018. This

was just below market expectations of 0.8 per cent quarterly growth and 2.5 per cent annual. Private sector wages rose 0.7 per cent for the quarter, outpacing the public sector (+0.6 per cent).

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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