Cutting Losses | Booking.com

7 November 2022

New Zealand Market Movers 

The New Zealand market (NZX 50 Index, +0.4%) moved slightly higher on Friday. Fisher & Paykel Healthcare (+0.8%) recouped some of its –3.5% loss on Thursday. At the same time, A2 Milk (-1.5%) pared some of its +4.2% gain from Thursday, after it announced that it had secured FDA approval to sell infant formula into the United States. 

Australia Market Movers 

The Australian market (ASX 200 Index, +0.5%) rose on Friday, helped by a lift in Energy (+3.4%). 

However, the story of the day was in Technology (+4.1%). Block (+10.9%) surged after reporting its third quarter profit of US $1.57 billion, which beat market expectations of US $1.52 billion, and represents a 38% increase over its profits from this time last year. 

On the economic front, the Reserve Bank of Australia upgraded its peak forecast up half a percent. This week, investors will be watching the Westpac Consumer Confidence and NAB Business Confidence reports. 

Europe Market Movers  

European markets (Stoxx 600 Index, +1.8%) closed higher on Friday, with all sectors in the green, led by Resources (+5.7%). Commodities surged, including copper (+7.5%) and silver (+7.1%) after reports emerged that China may consider a levelling down its zero-Covid policy. The Australian dollar (+2.8%) and New Zealand dollar (+2.6%) also surged on the report. 

In other news, Addidas (+21.4%) surged on Friday after reports that Puma’s (-0.5%) current head Bjorn Gulden will shift allegiance to the three stripes after current Chief Executive Kasper Rorsted moves on from the company in 2023. 

US Market Movers 

US markets (S&P 500 Index +1.4%) rallied on Friday, helping partially offset the losses registered for the week, with the S&P down -3.4% in total. 

October’s Non Farm Payrolls was the weakest in almost 2 years but still beat expectations, coming in at 261K (vs. 200K expected). While this indicates a slowing labour market, it won’t likely be enough to cause any pivot in the US Federal Reserve’s rate hike pace. 

On Saturday, Berkshire Hathaway (+0.8%) reported an increase in operating earnings in the third quarter, up 20% from year-earlier period to $7.76 billion. However, the value of its investments fell by $10.1 billion during the quarter, bringing its 2022 total decline to $63.9 billion. 

Setting the tone for this week will be cautiousness surrounding two major events. The first is the US midterm elections, due Wednesday/ Thursday depending on the vote count speed, and the second is Friday’s inflation report, due 2.30 am. 

 
Stock In Focus Booking.com

Booking Holdings reported both a strong revenue and EPS beat for the third quarter of 2022 as consumers begin to travel again and more of the world opens up. We anticipated this in our last report on the company, seeing the stock as a reopening play. The company reported revenue of $6.05B vs estimates of ~$5.9B and earnings per share of $53.03 vs. the street’s estimates of $49.85. Room nights booked were up 8% on a three-year stack. Q3 revenue was 20% higher on a three-year stack and adjusted operating earnings (EBITDA) was 7% higher. These are stellar results and the stock as justifiably rallied in spite of the broader market selloff. We reiterate what we have said in our reports on Visa and Mastercard: consumer spend is shifting from “things” to experiences and Booking Holdings benefits from this.

What Markets will be Watching this Week (UTC +13) 

Monday 
 

Tuesday 
AU Westpac Consumer Confidence  

AU NAB Business Confidence reports.   

Wednesday 
CN Inflation Rate year-on-year OCT 

Thursday 
AU Consumer Inflation Expectations NOV 

Friday 
US Inflation Rate year-on-year OCT 

GB GDP Growth Rate year-on-year Q3 

NZ Business NZ PMI OCT 

Saturday 
US Michigan Consumer Sentiment NOV 

The New Zealand market (NZX 50 Index, +0.4%) moved slightly higher on Friday. Fisher & Paykel Healthcare (+0.8%) recouped some of its –3.5% loss on Thursday. At the same time, A2 Milk (-1.5%) pared some of its +4.2% gain from Thursday, after it announced that it had secured FDA approval to sell infant formula into the United States. 

Do You Want Daily Market Insights?

If you’re interested in staying up-to-date with the latest news and analysis on stocks, be sure to sign up to BlackBull Research.

1 Month Free Trial

Access our expert stock market research Free of charge with no obligation

Free 1 Month Free Trial

Unlock this article & access our expert stock market research

ASX, NZX & USD Stock Buy, Hold, Sell recommendations. Model Portfolios. Daily news and more

[pmpro_checkout]