Global markets were lower overnight, US Markets (S&P500, -0.8%) closed lower as investors worried about sharp rate hikes coming ahead.
This comes after strong US manufacturing for the month on May indicating an accelerating in activity digesting inflation has room to rise further. JP Morgan CEO Jamie Dimon warned investors to brace for an “economic hurricane” raising pessimism from “storm clouds” caused by tightening monetary policy, a sharp rise in interest rates and inflationary impacts caused by the war brewing in Ukraine.
This saw all sectors trade in the red except for Energy, with financials and healthcare leading losses.
European markets (Stoxx 600 index, -1.0%) traded lower as inflation fears persists.
Pacific Edge (PEB:NZX)
Pacific Edge shares surged +16.9% yesterday, as investors welcomed a positive update after a long dry spell. It announced healthcare giant Kaiser Permanente had given the green light to add Cxbladder to its electronic medical records system – which makes it easier to order and view tests greatly increasing adoption rates over the Kaiser network of 39 hospitals and covers more than 12.6 million members.
We remain BUY rated on Pacific Edge, with a medium to long-term investment horizon.
Australia & New Zealand Market Movers
The Australian market was up yesterday (ASX200 index, +0.3%) on a mixed day of trade, helped by Australia’s GDP increasing by +0.8% for the first quarter of 2022, ahead of expectations of +0.5%.
Lithium miners were hit hard Pilbara minerals down -22%, as well as other suffering heavy losses after a note said lithium prices may peaked and could be due for sharp correction, enough to bring material sectors lower despite modest gains from the big three iron ore giants.
Utilities was the worst performing sector dragged down by Origin Energy which fell -13.7% after issuing a profit warning and withdrew its 2023 guidance.
The New Zealand market (NZX 50 index, +0.6%) was up on Wednesday, led by strong updates from small caps.
Cannasouth rose +11%, after beginning its first commercial harvest, while rival Rua Bioscience (+6.7%) and Greenfern (+2.8%) were also up.
3 Things Markets will be Watching this Week
- Geopolitical risks remain elevated given the Russia/Ukraine conflict.
- Macro level data this week includes, Inflation (CPI) from Eurozone, key employment data from the US and PMI data from China and US
- Locally, Australian first quarter GDP data and NZ business confidence measure. Also, earnings starts to tail off with results from Arvida and Metro performance Glass.