New Zealand Market Movers
The New Zealand market (NZX 50 Index, +1.1%) rose on the back of large gains from Mainfreight (+5.6%) and Fisher & Paykel Healthcare (+3.7%). The former adding to its +4.5% rally last Friday, after revising upwards its estimated revenue for the 26 weeks to 30 September +32.5% to $3.01 billion.
NZX sectors were mixed on the day. Communications Services (+1.9%) and Industrials (+1.6%) led advances, while Financials (-2.7%) led losses. Heartland Group (-4.0%) Continues to be punished for its plan to purchase Challenger Bank from ASX listed Challenger Group (+0.2%).
Australia Market Movers
The Australian market (ASX 200 Index, +0.3%) rose marginally, although most sectors advanced on Tuesday. Real Estate (+1.7%) and Communication Services (+1.6%) led gains, while only Materials (-1.2%) and Energy (-1.6%) declined on the day.
Oil refiner Ampol (-12.6%) tumbled after Chief Executive Matt Halliday warned of further market volatility and disappointing on third-quarter net profit compared to previous periods. Ampol’s Earnings Before Interest and Taxes for the first nine months of the year exceeded $1 billion but slowed to $272.3 million in the third quarter.
Europe Market Movers
European markets (Stoxx 600 Index, +1.4%) rose on Tuesday, hitting a one month high in the process. Real Estate (+1.7%) and Financial (+1.7%) lead sectorial gains. Logitech (+12.5%), UBS (+7.7%), and SAP (+6.5%) all surged after releasing better than expected earnings or reaffirming favourable full-year forecasts.
US Market Movers
US markets (S&P 500 Index +1.6%) recorded its third day of gains on Tuesday.
Alphabet (+1.9%) and Microsoft (+1.4%) both reported earnings after the bell.
Alphabet reported disappointing earnings and are being pummeled in after-hours trading, currently down -5.9%. Alphabet reported revenue of $69.09 billion vs. $70.58 billion expected.
Microsoft surpassed expectations, except cloud revenue was lower than expected. Microsoft reported revenue of $50.12 billion vs. $49.61 billion as expected, representing a +11% growth year-over-year in the quarter. In after-hours trading, MSFT is down at –2.4%.
Apple (+1.9%) reports tomorrow and we are expecting lower-than-expected earnings. Reports of the company cutting production numbers of its latest iPhone, are obviously an unfavourable indicator. Further, Apple TV+’s increase in price (what is there to watch on Apple TV+ that warrants an increase?) make us uneasy as well – and chalk it up to an imprudent reach by the company to counter persistently high inflation. We expect some margin contraction but nothing too drastic.
Stock In Focus
Cola-cola (KO.NYSE)
Coca-Cola (+0.0%) released it third quarter earnings before the market opened on Tuesday. The beverage giant beat revenue expectations, reporting $11.05 billion vs. $10.52 billion expected. Sales volume increased +4.0% for the quarter with Coke Zero Sugar, Powerade, Bodyarmor, and Costa Coffee lead performers in the company’s portfolio. Further, Cola-Cola raised its full-year outlook even after it raised prices to make up for higher input costs.
Sector compatriot McDonald’s (0.0%) reports on Thursday. Now that we have seen better-than-expected growth at Coca-Cola, PepsiCo (0.0%), and Dominos (+0.0%), we expect consumers to keep up with inflation on cheap consumables (i.e., fast food). For McDonald’s, we expect contracted margins but revenue beat.
What Markets will be Watching this Week (UTC +13)
Monday
CN GDP Growth Rate Year-on-Year Quarter 3
Tuesday
US Microsoft earnings
Alphabet earnings
Visa Earnings
Coca-Cola earnings
Wednesday
AU Inflation Rate YoY Q3
Meta Platforms earnings
Boeing Earnings
Thursday
CA BoC Interest Rate Decision
Apple earnings
Amazon earnings
McDonald’s earnings
Starbucks earnings
Friday
EA ECB Interest Rate Decision
US GDP Growth Rate Quarter-on-Quarter
Exxon Mobil earnings