Global markets were higher overnight, US Markets (S&P500, +0.3%) starting the week higher as it tries to rebound from another losing week.
Investor sentiment improving after Beijing rolled back some of its covid related restrictions, and the Wall street journal reporting Chinese regulators are wrapping up their investigations into ride-hailing giant Didi – signalling the country could be easing their crackdown on tech sector.
Amazon shares rose +2% following its 20 to 1 stock split, while most tech shares were mixed on the day.
Investors continue to grapple with fears central banks will raise interest rates too fast and cause a recession. Investors will be focused on US inflation data (CPI) for the month of May due on Friday, expected to be cooler than April.
The U.S. economy added 390,000 jobs in May, the Labour Department said Friday, which came in better than expected despite fears of an economic slowdown and amid the roaring pace of inflation. Some investors believe the strong hiring data could be clearing the way for the Fed to remain aggressive.
European markets (Stoxx 600 index, +1%) closed higher, as mining stocks lead gains.
Locally The RBA is to release their interest rate decision today the market anticipating a 50% chance of a 40-basis point rate hike to 0.75% in response to 20-year high inflation of 5.11% in the first quarter. This would be the RBA’s second-rate increase, while lagging its peers are now tipped for further rate hikes in the coming months as well, as it returns to its neutral rate.
Sky TV (SKT:NZX)
Sky TV shares are current down just over -6% today after addressing media speculation to Sky’s possible acquisition of MediaWorks Holding s Limited. Sky advises that, it is currently in exclusive negotiations with Mediaworks shareholders regarding a potential acquisition of MediaWorks’ radio and out of home advertising business. The likelihood of a transaction proceeding is still highly uncertain with discussions and due diligence ongoing and incomplete, and under the current proposed transaction structure if an acquisition of Mediaworks proceeds, it would not require Sky to raise new equity but would require approval of an ordinary resolution by shareholders at an Extraordinary Shareholder Meeting.
We are HOLD rated on Sky TV
Australia & New Zealand Market Movers
The Australian market was down yesterday (ASX200 index, -0.5%) as markets prepare for the RBA’s rate decision.
Most sectors were lower, tech shares leading losses. Energy sector reported the largest gain as the price of Brent Crude oil reach $120/barrel as Saudi Arabia signaled a larger than expected price increase in Asia.
Woodside Energy rose +3.2% following the completion of its merger as analyst upgrade their rating on the stock as the larger scale of operation will benefit from the current high commodity market.
Magellan was the biggest loser of the day slumping-13.9% down to an 8-year low after its funds under managed drop to $65m billion, from $68.6 billion, almost halving from $116.4 billion in November.
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) data from the US and China, and interest rate decision from the ECB.
- Locally, Locally, RBA interest rate decision.