He said the speech was timed for straight after the close of the New York Stock Exchange so markets and investors in the rest of the world could digest the information before the markets reopen.
Sullivan said the market was expecting a broad-based 20% tariff on all goods imported into the US. “There will be some interesting share movements if it’s anything other than this.”
Goldman Sachs has cautioned that aggressive tariffs could raise inflation and severely slow economic growth. The investment bank has raised its forecast for US inflation this year to 3.5% (from 3%), cut its GDP growth outlook to 1% (from 1.5%), and raised its unemployment estimate to 4.5% (from 4.2%).
Goldman now predicts a 35% chance of recession in the next 12 months, up from 20% in its prior outlook.
At home, market leader Fisher and Paykel Healthcare did the heavy lifting, rising 60c or 1.74% to $35.10 on relief that its medical devices manufactured in Mexico may be subjected to a 20% duty in the US, rather than 25%.
Freightways increased 31c or 2.97% to $10.75, and Meridian Energy gained 11.5c or 2.01% to $5.835.
After the Trump tariffs, the local market can look forward to next week’s Reserve Bank meeting.
ANZ said markets and economists are united in expecting the Reserve Bank to cut the official cash rate by 25 basis points to 3.5%. Such a move was signalled at the bank’s February monetary policy statement and the data has not provided sufficient grounds to diverge from the plan.
The housing market is going nowhere fast, consumer confidence is in the doldrums, the labour market recovery is sluggish, and the lift in retail spending is gradual. None of that will be a surprise to the Reserve Bank, ANZ said.
Auckland International Airport was down 7.5c to $7.925; Chorus decreased 13c to $8.04, Port of Tauranga eased 7c to $6.54; Manawa Energy shed 6c to $4.70 and Synlait Milk declined 3c or 3.85% to 75c.
Serko fell 22c or 5.47% to $3.80; Oceania Healthcare decreased 2c or 3.23% to 60c; Vista Group eased 6c to $3.60; Investore declined 2c or 1.87% to $1.05; Green Cross Health shed 3c or 3.9% to 74c; and Move Logistics was down 1c or 4.55% to 21c.
New Talisman Gold Mines’ strong run was curtailed with a 1c or 12.05% fall to 7.3c.
NZME declined 2c to $1.16. The publisher and broadcaster has delayed its annual meeting from April 29 to June 3 while it seeks legal advice and engages with shareholders over new information from Jim Grenon. Director nominations need to be resubmitted by May 5.
Tower was up 1.5c to $1.40 after Bain Capital sold its 19.9% shareholding at $1.30 a share. In a disclosure notice, Accident Compensation Corporation increased its stake from 7.92% to 9.06% after selling 5.84 million shares for $6.08m and buying 4.85 million shares for $7.63m between October 22 and April 1.
Seeka rose 22c or 5.96% to $3.91; PGG Wrightson increased 17c or 9.5% to $1.96; T&G Global added 6c or 3.59% to $1.73; Booster Innovation Fund improved 2.5c or 1.75% to $1.455; and TradeWindow was up 0.006c or 3.45% to 18c.
Comvita, down 1c to 72c, has told the market it is continuing discussions with its banking syndicate over longer-term covenants, saying “we do not consider that our present covenant structure is appropriate in the current circumstances”.
Comvita, which already has waivers, said that without further relief or amendment of the structure, covenants following the March 31 test date would not be met and will be tested again at the end of June.
Cooks Coffee, easing 0.005c or 1.72% to 28.5c, told the market it has finalised a $1.6m loan facility with a term of 15 years and a $1m facility for five years with the BNZ to repay or refinance all existing debt.
