Jarden Brief: Oil prices decline, NZX continues downward trend

The NZX 50 continued its downward trend, falling a further 1.3 per cent yesterday. Photo / Getty Images

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

International
US

At the time of writing, the S&P 500 was up 0.7 per cent, the Nasdaq rose 1.6 per cent and the Dow Jones Industrial Average was flat.

Sectors were mixed with six of 11 in the green. Technology (+2.7 per cent), communication services (+2.0 per cent) and health (+0.8 per cent) were the biggest gainers. On the flip side, real estate (-1.3 per cent), utilities (-1.0 per cent) and consumer staples (-0.3 per cent) were in the red.

Cybersecurity company Fortinet was the top performer, up 8.5 per cent. Food distributor Sysco was up 8.2 per cent after it reported fiscal third-quarter earnings per share of US$59 cents which beat expectations. Microchip Technology rose 6.7 per cent.

Conversely, dental equipment manufacturer Dentsply Sirona hit a new 52-week low down 7.6 per cent after reporting a drop in sales and profit for the first quarter. Profit was US$30 cents a share compared to US$53 cents a share a year earlier. Rounding out the underperformers were tobacco company Altria Group (-7.5 per cent) and consumer goods company Newell Brands (-5.2 per cent).

Migraine pill maker Biohaven Pharmaceutical surged 69.8 per cent after Pfizer announced it will pay US$11.6 billion to acquire the company. This is the biggest deal Pfizer has made since 2016, it currently has about US$32 billion in cash available after its success with Covid-19 drugs.

Movie theatre operator AMC Entertainment decreased 4.8 per cent after posting a smaller than expected quarterly loss.

Rest of the World

Asian markets were mixed overnight. The Shanghai Composite rose 1.1 per cent, Nikkei declined 0.6 per cent, and the Hang Seng fell 1.8 per cent.

European markets were in the green. The FTSE increased 0.4 per cent, the DAX was up 1.2 per cent and the CAC gained 0.5 per cent.

Commodities

Gold declined 0.9 per cent to US$1,824.80 per ounce, while silver also lost 1.4 per cent to US$21.52 per ounce.

Oil continued yesterday's decline, falling 2.3 per cent to US$100.72 per barrel.

The cryptocurrency market was largely in the green, making a partial recovery following yesterday's losses, with Bitcoin and Ethereum rallying 3.0 and 5.8 per cent, respectively.

The US 10-Year Treasury rate decreased 10 basis points to 2.977 per cent alongside a 10 basis point decline in the 30-year rate, to 3.112 per cent.

New Zealand

The NZX 50 continued its downward trend, falling a further 1.3 per cent yesterday.

All but four companies finished Tuesday's trading session in the red. Air New Zealand led the underperformers, with a fall of 8.5 per cent to 70 cents. This could be connected to retail investors exercising their right to buy new shares at 53 cents each and then selling them. Shares in the airline have dropped more than 20 per cent since rights trading closed on 2 May.

Healthcare company Pacific Edge Limited followed with a 6.0 per cent decline. The cancer diagnostics company is advancing its study of the clinical utility of Cxbladder Monitor for surveillance of recurrent urothelial cancer against the current American Urological Association standard of care. Pacific Edge has advised its full year results for fiscal year 2022 will be released on 26 May.

Sky TV rounded out the bottom performers, down 4.3 per cent.

Ryman Healthcare was the frontrunner and recorded the day's biggest single rise. Ryman turned a corner yesterday, recovering from its fall at the start of the week, up 6.7 per cent. Electricity gentailer Mercury also beat back the sea of red and gained 2.5 per cent. Rounding off the top performers is manufacturing company Skellerup Holdings which rose 2.4 per cent.

In macroeconomic terms, ANZ Truckometer's Heavy Traffic Index, which has been seen as a potential indicator for quarterly GDP growth, rose 2.3 per cent throughout Covid-19 disruptions in April. This would suggest a weak but positive growth in the first quarter. The Light Traffic Index increased 8.3 per cent in April.

Z Energy shares were de-listed from the New Zealand and Australian stock exchange main boards yesterday after Ampol completed its purchase for $2 billion.

Australia

The ASX 200 continued its downward trend, decreasing 1.0 per cent further to 7,051.20 points.

During yesterday's trading session the index slumped to 6939.5 points, a three-month low, before recovering prior to close of market. The index was influenced by declines in the following sectors.

10 of the 11 sectors closed in the red. Materials led these sectors, reducing 2.4 per cent. It was followed closely by energy and utilities, falling 2.1 per cent and 1.0 per cent, respectively.

Telecommunications services was the only sector that finished at a higher level than the previous trading session. The sector increased by 0.4 per cent, rebounding from a recent decline. However, the sector is down 3.1 per cent across the last five trading sessions.

Medical devices company PolyNovo continued their top performance yesterday, elevating a further 15.6 per cent and closing as the index's top performer. The share price seemingly built on yesterday's news regarding three of the company's directors completing on-market share acquisitions totalling roughly A$1.5 million.

Global asset management company Pendal Group rose 8.1 per cent. This one-month high follows the release of positive first-half year results for 2022. The company posted a net profit of A$96.7 million, a 7.5 per cent increase from the previous year. Further the total revenue improved 20.0 per cent to A$351.9 million, correlating to the 37.3 per cent rise in average funds under management.

Rounding out yesterday's top performers was location-based services company Life 360, rising 5.8 per cent.

Insurance broker provider and underwriting agency AUB Group was yesterday's biggest underperformer, dropping 11.8 per cent. This follows the company completing its institutional placement and entitlement offer to take over Tysers Insurance Brokers for A$880 million. This acquisition will be funded by a mix of capital raising, placement of shares and a new multi-currency debt facility.

Chalice Mining continued the previous day's poor share price performance, declining 6.7 per cent. Paladin Energy closed out the bottom movers, decreasing 4.8 per cent.

The Australian dollar fell to its weakest point since July 2020 yesterday, sinking 1.8 per cent to US$0.6945.

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

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