Global markets were mixed overnight, as US Markets (S&P 500 Index, +0.6%) ended the session higher after recovering from a drop on the open following a disappointing April – its worst month since March 2020.
Investor support seemed to gain traction after the market reached its lowest level of 2022, and a level not seen since May 2021.Tech companies rebounded strongly, given they had been sold off so heavily, while real estate was the weakest most sensitive to rising interest rates.
The 10-year treasury yield rose above 3% for the first time since 2018, in anticipation the fed’s interest rate decision later this week.
European markets (Stoxx 600 index, -1.5%) were lower partly due to ex dividend trades and increased investors’ concerns following weak factory data from China.
Adveritas (AV1:ASX)
Adveritas released a solid update for the March 2022 quarter. Revenue came in at $473,000 up +120% from the same corresponding period last year. After growing the number of company on trials, Adveristas were able to sign several industry leading clients across betting, retail and fintech sectors – as well as upgrade sign ups from Go-Jek, Singtel and William Hill.
Marketing efforts have been scaled up following the launch their Google cloud marketplace expected to reach scale (target a mass amount of low value clients) from April 2022 and is set to be a significant sales channel. The Adveritas balance sheet has been strengthened with $8m in cash available after raising another $3m in convertible notes (a form of debt to avoid immediate share dilution) recently supported by long-term major shareholder to help accelerate sales and marketing efforts.
We remain BUY rated on Adveritas.
Australia & New Zealand Market Movers
The Australian market was down yesterday (ASX200 index -1.2%)
Following a weak lead from Wall street, selling was broad-based with all sectors trading lower.
Tech shares in particular were hardest hit and led losses, followed by real estate. Both sectors being sensitive to rising interest rates, heading into this week’s RBA and Fed interest rate decision. The market is pricing in a much higher probability of the RBA delivering its first-rate hike this week, ahead of earlier expectations and pricing in more hikes for the remainder of the year.
Qantas rose +2.9% after the airline flagged that it would return to profitability in the next financial year as leisure and corporate travel market bounces back strongly, and are confident with the bounce-back in demand and ordered 52 new planes. Helloworld Travel was up +2.7% after announcing improving travel demand say transaction values for the March quarter increased +60% from last year to $419m.
The New Zealand market was lower Monday (NZX 50 index -0.8%) on light volume, but moves were considered mild, compared to the sharp selloff in US markets on Friday.
3 Things Markets will be Watching this Week
- Geopolitical risks remain elevated with the Russia/Ukraine conflict.
- Central bank interest rate decision from RBA and the Fed, and employment data in New Zealand
- US earnings continues, locally earnings seasons beings starting with the banks ANZ, Macquarie and NAB are all due to report this week
