Global markets were mostly higher overnight in quiet trade as the US market was closed for Memorial Day.
Closer to home, the Sydney and Melbourne property markets are showing early signs of ending their steep slides, with a strong bounce in auction clearance rates on the first Saturday after the federal election. While it is too early to make conclusions, with the RBA also set to cut interest rates and with potential bank lending rule changes we may be near the bottom in terms of property facing sectors.
It was a busy day on the NZ market yesterday, with tourism facing stocks Air NZ & Tourism Holdings providing updates, while Fisher & Paykel Healthcare released a result which we discuss below.
Stock in Focus: Fisher & Paykel Healthcare (FPH:NZX / FPH:ASX)
Breathing mask maker Fisher & Paykel Healthcare reported another record profit yesterday as it topped $1 billion in annual revenue for the first time and lifted profit 10 percent to $209.2 million in the March year.
FPH also flagged earnings growth of at least 14 percent for the current financial year, with an overall solid result at the top end of guidance. However, the share price reaction was negative given the stock is up strongly and trading near all-time highs it appears some investors are taking profits.
We currently have a BUY recommendation on FPH.
Members should look out for a full update on FPH to be released in our weekly report.
Australia & New Zealand Market Movers
The Australian share market was a touch lower on Monday (ASX 200 index -0.06%) as a lack of news saw most companies trade in a fairly narrow range. The major iron ore miners were firmer on Monday as the price of iron ore remained above $US100 a tonne. Ongoing supply tightness in the iron ore market has pushed the price of the bulk to a five-year high. Vocus Group rose 17% after announcing Swedish private equity company EQT Infrastructure had made a $3.3 billion takeover bid for the telecommunications company.
The New Zealand market sold off to start the week (NZX 50 index -0.73%) with investors locking in recent gains from market index heavyweight Fisher & Paykel Healthcare. Tourism Holdings led the market lower, as the rental RV operator announced plans to scale back capital spending in the US, where a downturn in the market has dented operations. Air New Zealand also slipped as it announced a multi-billion dollar investment in new Boeing planes. Separately, it downgraded annual earnings guidance due to more expensive jet fuel and warned of slower growth over the next three years.
3 Things Markets Will be Watching this Week
- Mini reporting season across Australasia sees a number of Aussie & Kiwi stocks make earnings announcements this week.
- The latest US economic growth figures (GDP) are released on Friday morning (AU/NZ time).
- The NZ government budget is released on Thursday.
Have a Great Day,