Global markets were volatile overnight, but the US market (S&P 500 index +0.3%) closed higher in a choppy session.
There were mixed market moves as company earnings continue to show strength and drive gains. Chipmaker Nvidia saw its shares surge 8.3% after the company reported beats on the top line revenue and bottom line profit and issued a bullish revenue forecast for the current quarter ending in January. The news saw other chipmakers to trade higher such as Qualcomm (+1%) and Micron Technology (+2%).
Technology mega-caps like Amazon (+3.2%) were in favour overnight, while more speculative stocks like electric vehicle developers Rivian (-15.5%) and Lucid (-14.4%) took a breather. Interestingly, Apple (+2.5%) is reportedly aiming for a fully-autonomous electric vehicle as soon as 2025.
European Markets (Stoxx 600 index -0.6%) dipped as investors cite concerns over inflation outlook in the region, and there was weakness in oil and metals prices that weighed heavily on commodity stocks.
Aristocrat (ALL:ASX)
Aristocrat Leisure shares fell -3.6% yesterday. This is despite the gaming technology company releasing a strong 2021 full-year result. Aristocrat delivered a +14.4% increase in revenue to $4.7 billion and an 81% lift in normalised net profit (NPATA) to $864.7m – this result was partially flagged earlier.
What looks to have weighed down on sentiment was a warning that Aristocrat’s takeover target, UK listed Playtech, is facing competition with a third suitor eyeing up making a competing offer.
We remain BUY rated on Aristocrat, and are "buyers on this price dip".
Australia & New Zealand Market Movers
The Australian market was down on Thursday (ASX 200 index -0.1%) as gains for healthcare, tech and consumer-facing sectors offset falls among energy plays and another sell off session across the big banks.
CBA fell another -1.6%, following a heavy loss on Wednesday after reporting a weak result, likewise its big 4 banking peers were also down. Energy stocks were lower as brent crude slipped below $80 per barrel as producers look to increase supply.
Treasury Wines rose +2.6% after announcing it has agreed to acquire Napa Valley’s Frank Family Vineyards for around $432m – it’s expected to fill a luxury chardonnay-sized hole in Treasury Americas’ portfolio.
The New Zealand market was down on Thursday (NZX 50 index -0.3%) following the Reserve Banks survey that showed inflations expectations for the next two years have jumped to just under 3%
This time property stocks were hit harder as they are most affected by higher interest rates, Investore Property leading the sector lower down -2.6%, while most gentailers and retirement villages were also weaker.
Meridian Energy's Australian business sale process is nearing a conclusion with a sizable special dividend a possible outcome for shareholders.
3 Things Markets will be Watching this Week
- Key events this week include CPI (Inflation) and employment data across the Eurozone and UK, and third quarter GDP in Europe.
- A raft of US housing market data is due along with retail sales and a data dump in China (retail sales, IP and fixed assets investment).
- Locally, CBA will release its first quarter result, AGM’s and Investor days held by Aristocrat, Incitec Pivot, Ryman Healthcare, Afterpay, Seek, a2Milk, BlueScope Steel, Goodman Group, Resmed, Wisetech and Next DC.