Podcast, ECB | Z Energy & Synlait Tumble

13 September 2019

Global markets ​were higher overnight ​​as shares on Wall Street ​hover ​just ​below​ a​ll-time high​s​, buoyed by positive developments on the US-China trade front and a promise of continued stimulus from the European Central Bank.

The European Central Bank has gone for stimulus as predicted, cutting its key rate to a record low​ (th​e main refinancing rate is now negative at -0.5%)  and will restart bond purchases of €20 billion a month up to shortly before the next rate decision​.​

​This weeks podcast discusses ​housing, an Uber Rant and Cannasouth Deep Dive (CBD)​. To listen CLICK HERE.
 

Stock in Focus: Z Energy (ZEL:NZX / ZEL:ASX)

​​​​​​​​​​​​​​​​​​​​​​​​​​​​Z Energy led the NZ market lower yesterday after cutting its earnings guidance by $60 million, most of which it blamed on "unprecedented" discounting among petrol retailers, coinciding with the Commerce Commission's market study of the sector. 

The company also was hit by lower refining margins. Z Energy trimmed its dividend, something which has been a key positive factor highlighted by investors bullish on the company.  

​We have been cautious on Z Energy for some time, and the operating environment remains difficult with volatile oil margins, retail competition, and the threat of government regulation.

We currently have a ​HOLD​ recommendation on​ ZEL.
Members should look out for a full update on ​ZEL to be released in our weekly report.

  
Australia & New Zealand Market Movers

​​The Australian market ​continued to trend higher yesterday (ASX 200 Index +0.​25​%) as the banks remained in favour while tech stocks and consumer staples turned around to finish the day in the red. Wesfarmers shares dropped after the Federal Court approved its takeover of lithium miner Kidman Resources, which is set to be delisted from the ASX after Friday’s close.

 
The New Zealand market ​was lower on Thursday (NZX 50 Index -​0​.​2​%) as investors punished fuel retailer Z Energy and dairy processor Synlait Milk for earnings downgrades.​ ​Synlait ​shares fell -9% to a three-month low ​as t​he milk processor lifted annual profit by 10 percent as revenue cracked a billion dollars for the first time, but disappointed analysts with its 2020 forecast.​ Synlait also said it remains optimistic about legal issues facing its soon-to-be commissioned Pokeno plant. ​

 

3 Things Markets Will be Watching this Week

  1. ​Trade War related news-flow is likely to continue to feature in headlines.
  2. US inflation data is published on Thursday.​
  3. Thursday's policy meeting at the European Central Bank​ will be watched closely​

 

Have a Great Day,
 

Team

The European Central Bank has gone for stimulus as predicted, cutting its key rate to a record low​ (th​e main refinancing rate is now negative at -0.5%)  and will restart bond purchases of €20 billion a month up to shortly before the next rate decision​.

Do You Want Daily Market Insights?

If you’re interested in staying up-to-date with the latest news and analysis on stocks, be sure to sign up to BlackBull Research.

1 Month Free Trial

Access our expert stock market research Free of charge with no obligation

Free 1 Month Free Trial

Unlock this article & access our expert stock market research

ASX, NZX & USD Stock Buy, Hold, Sell recommendations. Model Portfolios. Daily news and more

[pmpro_checkout]