Tech Recovery, Inflation | Pacific Edge

21 July 2022

Global markets were mixed overnight, as US markets (S&P 500 Index +0.6%) recovered for a third-day in a row as earnings so far have held up better than many had feared.

Technology stocks rose strongly, and the NASDAQ Index rose +1.6% on the back of a better-than-expected result from Netflix sparking a tech recovery. Tesla is also trading slightly higher after hours on its update. Most sectors were higher except for more defensive ones like utilities, healthcare, and consumer staples.

Following Apple’s suit, Google also said it would pause hiring over the next two weeks to review its headcount and aim to slow hiring over the remainder of the year – joining hiring freezes or layoffs from high-profile tech giants like Tesla and Meta.

European Markets (Stoxx 600 Index -0.2%) ended the session lower, reversing earlier gains as the relief rally loses momentum – ahead of the European Central Bank’s policy meeting on Thursday.

In inflation news, UK headline inflation (CPI) continues to rise, hitting 9.4% in June, slightly higher than expected. Meanwhile, Canada’s headline CPI came in at +8.1%, its highest level in almost 40 years, but to a surprise slightly lower than the +8.4% that was expected.

Pacific Edge Limited (PEB:NZX)

Bladder Cancer company Pacific Edge shares jumped +4.2% after saying it processed 7,055 tests in the first quarter of the 2023 financial year, up +13% from the previous quarter, and up +32% from the same corresponding period last year.

PEB appears it’s building momentum as awareness in the area grows, and we welcome this update. Looking ahead see the stock as a long-term growth play and are BUY rated on Pacific Edge

Australia & New Zealand Market Movers

The Australian market (ASX 200 Index, +1.7%) was up strongly yesterday, helped by a strong lead from Wall Street.

All sectors were higher with tech stocks leading gains. Data company Megaport soared +23%, while Xero (+5.9%) and Wisetech Global (+5.6%) both performed strongly.

Oil Producer Beach Energy shares were up +2.8% after its revenue rose +10%, recording its best quarterly revenue in three years.

The New Zealand market (NZX 50 Index +0.3) was up yesterday, as a few beaten-down growth stocks made back some ground.

Positive monthly updates from Contact Energy(+0.5%) and Genesis Energy (+0.9%) saw both companies rise.

3 Things Markets will be Watching this Week

  1. Major announcements this week include the European Central Bank rate decision and inflation data for the Eurozone, UK and Japan.
  2. US Corporate Earnings gets into full swing this week with Bank of America, Goldman Sachs, Johnson & Johnson, Netflix, Tesla, Twitter and American Express all scheduled to report. 
  3. Locally, NZ Inflation (CPI) data and quarterly updates from Major Australian Miners and Energy companies.
Global markets were mixed overnight, as US markets (S&P 500 Index +0.6%) recovered for a third-day in a row as earnings so far have held up better than many had feared.

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