Pre-Open Data
Key Data for the Week
- Wednesday – EUR – Trade Balance experienced a €7.6 billion deficit in February, after imports rose 39% and exports were 17% higher, year on year.
- Thursday – EUR – Consumer Price Index
- Thursday – EUR – Consumer Confidence
Australian Market
The Australian sharemarket inched ahead 0.1% on Wednesday, after strong gains made early in the session were retraced. Nevertheless, the ASX 200 closed at its highest level since January.
Most sectors advanced, except the Energy (-0.6%) and Materials (-1.5%) sectors, which broke their three-day winning streak after the price of oil, gold and iron ore retreated on Tuesday night. Notable detractors included Paladin Energy (-4.3%), BHP (-1.6%) and Oz Minerals (-3.8%). Rio Tinto also slipped 2.8%, after it reported a “challenging” 1Q2022, with lower than expected iron ore shipments and production.
Meanwhile, the Health Care (2.6%) sector boosted the local sharemarket, after news that Ramsay Health Care had received a takeover offer of $88 per share from a consortium of financial investors, led by American global investment company Kohlberg Kravis Roberts & Co. The offer represented a 36.7% premium to the company’s closing price on Tuesday. In response, Ramsay Health Care’s share price surged 24.2% on Wednesday, closing at $80 per share.
In other company news, oil and gas producer Santos (-1.1%) lost ground, after it announced a new capital management framework, which included an on-market share buyback of up to US$250 million. Furthermore, shares in Bega Cheese rose 1.0% yesterday, despite reporting that floods across Eastern Australia had “disrupted customer deliveries and increased transport and logistics costs”.
The Australian futures market points to a 0.40% increase today.
Overseas Markets
European sharemarkets were firmer on Wednesday, helped by positive company earnings results. The Technology (2.4%) sector led gains, pushed higher by chipmaker ASML Holding (5.3%). The company reported better than expected first quarter earnings and stated that it saw “zero” signs of easing demand. German semiconductor manufacturer, Infineon, also benefitted from the news, up 2.3%. Meanwhile, French food group, Danone, jumped 5.8% after it reported strong quarterly sales growth. By the close of trade, the STOXX Europe 600 added 0.8%, the German DAX rose 1.5% and the UK FTSE edged 0.4% higher.
US sharemarkets were mixed on Wednesday, after gains made by most sectors were impeded by key detractors. Netflix was a major detractor, down 35.1%, following its report of a 200,000 decrease in subscriber numbers in the first quarter. Other notable movers included mega caps like Amazon (-2.6%), Meta Platforms (-7.8%) and Alphabet (-1.8%). Meanwhile, IBM (7.1%) and Procter & Gamble (2.7%) both rose after positive earnings results. By the close of trade, the S&P 500 was relatively flat, the Dow Jones rose 0.7% and the NASDAQ lost 1.2%.
CNIS Perspective
New Zealand inflation accelerated in the first quarter to its fastest pace in 32 years, supporting the central bank’s decision to raise interest rates by half a percentage point as it pursues an aggressive tightening cycle.
Headline inflation surged to 6.9%, from 5.9% in the last quarter, better than economists’ consensus forecast of 7.1%. This slight discrepancy is a result of economists expecting a larger advance in the core consumer retail prices.
The weakening of the New Zealand Dollar has contributed to the cost of imports, driving the inflationary environment further.
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