Global markets were mixed overnight as Facebook shares fell -19%, weighing on the Technology sector, while the Dow Jones and S&P 500 market indices made gains.
The Facebook result shocked both investors and analysts with a significant downgrade of its growth outlook for the next two to three years. On the flipside, after the closing bell in New York, Amazon reported results that beat analysts expectations and the shares advanced.
Stocks across Asia were mixed after a weak result from Facebook led to a regionwide sell-down in growth-orientated stocks, offsetting earlier optimism of a cooling in trade tensions between the US and European Union after President Donald Trump's meeting with Jean-Claude Juncker.
Stock in Focus: Ryman Healthcare (RYM:NZ)
Ryman Healthcare, the country's biggest listed retirement village operator and developer told shareholders at yesterday's annual meeting first-quarter trading was satisfactory, and it had boosted nurses' pay beyond the increase in government funding for aged care.
We have previously highlighted that attracting quality workers may be an issue for the sector, particularly if immigration restrictions are imposed. The boost in pay highlights to us that Ryman want to remain competitive in the market. Ryman also said it has secured development approval for its fourth village in Melbourne, as it continues to expand across the Tasman.
We are positive on the retirement sector generally given the massive tailwind of an ageing population, although we have some reservations around Ryman’s premium valuation.
We currently have a HOLD rating on Ryman.
Australia & New Zealand Market Movers
The Australian share market was marginally lower yesterday (ASX 200 index -0.05%) as losses made by Macquarie Group were matched by gains from Newcrest Mining. Macquarie Group announced that chief executive officer Nicholas Moore would retire from his role with the bank, effective November 30. In other news, Fairfax shares were higher while Nine Entertainment fell after Fairfax Media and Nine Entertainment announced they would be entering a merger, with the new business to be called Nine. The combined business will include Nine's free-to-air television network, a portfolio of high growth digital businesses, including Domain, Stan and 9Now, as well as Fairfax's mastheads and radio interests through Macquarie Media.
The New Zealand market was slightly lower on Thursday (NZX 50 index -0.16%) as investors prepare for local earnings season. Property For Industry and Heartland Bank declined, while Sky Network Television extended its recovery. In stock news, Mainfreight gained as Chief executive Don Braid told shareholders at its annual meeting the June quarter registered strong revenue growth and is "quietly positive" that momentum will hold through the rest of the year. Aged care operator Oceania Healthcare also made gains after beating earnings guidance and increasing the pace of development.
3 Things Markets Will be Watching this Week
1. US corporate earnings season continues as investors digest quarterly company profit announcements.
2. Trade anxiety is likely to remain with Trump now threatening to impose tariffs on all $US500 billion of imported goods from China.
3. Key economic news flow includes – Australian inflation numbers out on Wednesday and US GDP data published at the end of the week.
Have a Great Day,
Team