US markets (S&P 500 Index + 0.7%) closed higher on Thursday despite a Q&A session with Jerome Powell at the Cato Institute, where he reiterated that the Federal Reserve is not considering a change to the pace at which it will hike interest rates.
With no change on the macro front, company specific news caused the biggest market moves. Rivian (+10.9%) shares surged after the company announced a partnership with Mercedes to build electric commercial vans in Europe. The leaking of a ‘turnaround plan’ memo from Snap (+9.3%) CEO Evan Spiegel helped the company post an almost double-digit gain.
European markets (Stoxx 600 Index, +0.5%) rose on Thursday with financials outperforming after the European Central Bank proceeded with a 75-basis-points rate hike and signaled additional unprecedented hikes in the next few meetings.
Kiwi Property Group (KPG:NZX)
Kiwi Property Group shares slipped after announcing it had secured a conditional sale for its Northlands Shopping Centre and 43 Langdons Road (Northlands) in Christchurch for $160m. The move its part of Kiwi Property’s plan to move away from non-core retail and focus on its mixed-use sites.
We are Buy rated on Kiwi Property group as it owns quality mixed use assets, and trades at a sizable discount to its net tangible asset per share of $1.45 (which is possibly due for downward movement) and pays investors an attractive gross dividend yield of ~7.5%
Australia & New Zealand Market Movers
The Australian market (ASX 200 Index, +1.8%) climbed on Thursday in reaction to Australia’s Reserve Bank Governor Philip Lowe’s dovish remarks. Noting that rate hikes are likely to continue but now at a slower rate, given cash rate now sits at a more neutral rate of 2.85%.
This prompted a broad based rally, with all sectors well in the green except for energy.
The technology (+3.2%) sector led the ASX higher, with Life360 (+16.4%), Zip (+9.0%), and Xero (+3.9%) were three of the day’s biggest gainers. Woodside Energy fell -5.5% on the back of oil slipping down to a 9-month low coupled by going ex-dividend as well.
The New Zealand market (NZX 50 Index, +1.1%) rose with other markets, with volume picking up thin trade at the beginning of the week.
After weighing the market down yesterday, SkyCity Entertainment (+1.8%) and Restaurant Brands (+1.1%) bounced back and finished in the green on Thursday.
What Markets will be Watching this Week
Monday
Australian PMI and retail sales data
Tuesday
Reserve Bank of Australia cash rate decision.
Wednesday
Eurozone employment and second quarter GDP data. Australia’s second quarter GDP data.
Thursday
Bank of Canada interest rate decision
Friday
European Central Bank interest rate decision and China (consumer) CPI and (producer) PPI inflation data.
