Global markets were lower overnight as a sharp drop in oil prices squeezed energy stocks. Oil prices are at a seven-month lows after news of increases in supply by several key producers, a trend that has undermined attempts by OPEC and other producers to support the market through reduced output.
Closer to home, while the Australian market was under pressure yesterday the NZ market briefly touched an all-time high.
Minutes from the latest Reserve Bank of Australia meeting showed that jobs and housing are still worries for the RBA. A continuing slide in the number of hours people are working and ongoing worries about household debt convinced Australia's central bank that the official interest rate should remain unchanged at its last meeting.
Positive signs in some areas of employment, better business conditions and evidence that a regulatory crackdown on investor lending is starting to bite encouraged the Reserve Bank of Australia board’s view of the nation’s economic wellbeing, minutes from its June meeting showed. Overall continue to believe the RBA will keep interest rates unchanged in the near term.
NZX Briefly Touches New High
Given the NZ market (measured by the NZX 50 index) is back at all-time highs, it is clearly hard to argue the market is “cheap” overall. However, we continue to see opportunities in selected stocks across key sector plays with solid investment themes such as agriculture, tourism and healthcare.
Australia & New Zealand Market Movers
The Australian share market fell yesterday (ASX 200 index -0.83%) as Banks and Real Estate stocks dragged the Australian share market into negative territory after ratings agency Moody’s downgraded the lenders last night on housing market and excessive debt concerns. In stock news Tabcorp said its merger with gaming rival Tatts Group will create $130 million in additional earnings, in part from job cuts, after securing regulatory approval for the $11 billion deal on Tuesday.
The New Zealand market ended the day lower yesterday (NZX 50 index -0.07%) as the market briefly touched a new record high. Air New Zealand shares rose to a 16-year high, but weaker blue-chip stocks including Ryman Healthcare, Spark New Zealand and Auckland International Airport weighed on the broader market
3 Things Markets Will be Watching this Week
1. The Reserve Bank of New Zealand makes an interest rate decision on Thursday.
2. Minutes from the last Reserve Bank of Australia meeting are released on Tuesday.
3. How the US Technology sector trades following its recent correction.
Have a Great Day,
Team
