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Jarden Brief: Musk’s SpaceX wins billion-dollar contract battle with Bezos’ Blue Origin

Keeping you up to date with the latest market moves, in association with Investment firm Jarden

New Zealand

The NZX50 rose 0.7 per cent yesterday driven largely by positive sentiment surrounding the opening of the trans-Tasman bubble.

Leading the rise were the industrials and consumer non-cyclicals sectors which rose 2.1 and 1.2 per cent, respectively.

The top performing company on the NZX50 was Auckland International Airport, which rose up 4.7 per cent amidst positive sentiment from the reopened bubble. Recently completed highway upgrades should also support improved transport options for getting to and from Auckland Airport.

Another outperformer was cinema software company Vista Group International, gaining another 3.5 per cent off positive economic data in the US, its key market. Vista has been a strong recovery stock, now up 68.3 per cent since its lows in February.

Utilities and energy sectors both fell 0.4 per cent.

Meanwhile, shares in Meridian Energy continued to be volatile – falling by as much as 4.8 per cent intraday after Friday’s ETF rebalance.

Kiwifruit orchard and packhouse company Seeka (+1.0 per cent) is another step closer to amalgamating with Opotiki Packing and Cool Storage Limited (OPAC). 99.94 per cent of Seeka shareholders voted in favour of the acquisition at the Annual Shareholders Meeting on Friday; far exceeding the required 50 per cent.

Payments company SmartPay released its 4th quarter results (ended 31 March 2021) yesterday. Acquiring revenue increased in the March quarter, 97 per cent year-on-year, up 15 per cent from the December 2020 quarter. Australian transacting terminals have reached a record high of 6,754. Investors responded favourably to this news, with SmartPay rising 4.3 per cent.

Industrials and agribusiness manufacturer Skellerup upgraded their financial year 2021 earnings guidance for the second time this year, upgrading their expected net profit to be between $37 and $39 million for the full year. Skellerup attributes a stronger than expected 3Q to essential dairy consumables being better than expected, as well as continued growth for marine foam products in all markets. Sales of potable water products in the US were also robust. The company did note it has been affected by global freight issues, although did not provide further detail.

INTERNATIONAL
US:

US markets are in the red this morning as the S&P 500, Nasdaq and Dow Jones Industrial Average are currently trading down 0.6, 1.1 and 0.4 per cent at time of writing.

Real Estate and Financials were the only sectors up this morning with slim movements of 0.2 and 0.1 per cent, respectively.

Chemical manufacturer Albemarle Corp was today’s single stock leader, rising 4.1 per cent. Meanwhile, investment bank Charles Schwab Corp traded favourably after a series of target price upgrades at the end of last week, up 2.2 per cent.

In contrast, downward pressure on indices was drawn from sector losses of Consumer Cyclicals (-1.0 per cent) and Basic Materials (-0.9 per cent).

Renewable energy provider Enphase Energy Inc was the worst performer today, slumping to a 6.0 per cent loss following a volatile period for the industry. Joining Enphase was casino and gaming manager Penn National Gaming Inc, which is also down 6.0 per cent at the time of writing.

News out of the US over the weekend included a contract win for Elon Musk’s SpaceX, enabling the company sole rights to be the next enterprise to land Astronauts on the moon. Both SpaceX and Jeff Bezos’ Blue Origin were the front runners to land the contract. In the end, SpaceX won the Nasa contract, offering to build and operate a lander if the space agency funded a fraction under US$3 billion.

Rest of the world:

The main Asian indices closed up last night, with the Shenzhen up 2.4 per cent along with the Shanghai Composite which added 1.5 per cent. The Nikkei advanced a slim 0.1 per cent.

Fresh reports have emerged that tech tycoon Jack Ma is exploring options to potentially sell down his controlling stake in global e-commerce giant Ant Group. These reports come as a direct response to increased regulatory scrutiny in China, which saw the company being handed a US$2.75 billion fine earlier this month after various breaches of anti-competitive behaviour.

Commodities:

Among the commonly tracked commodities. Gold is down 0.5 per cent at US$1,771.0 per ounce. Cryptocurrencies also fell today with Bitcoin sliding 0.2 per cent to US$55,671.4 while Ethereum followed suit with a loss of 1.1 per cent to US$2,167.92. WTI Crude oil made a 0.5 per cent gain to US$63.45 per barrel.

The 10-year treasury yield decreased very slightly to 1.64 per cent, after the weekly jobless claims report turned out to be worse than expected. The first-time claims for the week ending 3 April were 744,000, according to the US Labour Department, vs 694,000 expected by economists.

Australia

The ASX200 closed Monday’s session at 7065.6 points, edging slightly higher than on Friday.

Sector performances were mixed. Materials (+0.8 per cent) and Utilities (+0.6 per cent) rose, while Energy (-1.4 per cent) and A-REIT (-1.2 per cent) underperformed.
Sims Metal Management posted the biggest gains of the day. The electronics recycling solutions provider rose 9.0 per cent after publishing a positive trading update. Car dealer Eagers Automotive and goldminer Resolute Mining were also on the leader board, up 4.6 and 3.9 per cent, respectively.

Underperformers of Monday’s session included Zip Co, falling 4.5 per cent after big gains the following week, as well as online betting platform Pointsbet, which fell 4.1 per cent. National Storage REIT, which manages and operates self-storage centres, was down 3.6 per cent.

PowAR and Mercury NZ have agreed to increase their offer for Tilt Renewables to NZ$8.10 a share from NZ$7.80 a share, and Tilt’s largest shareholder, Infratil has agreed to vote its 65.5 per cent shareholding in favour of the transaction.
Jarden is advising Powering Australian Renewables (PowAR) on the acquisition and Scheme of Arrangement with Tilt.

In addition to the travel bubble between Australia and New Zealand, the Australian government and Singapore are in conversation about potential quarantine-free travel between the two countries. Travel stocks closed slightly lower however, despite increasing at the beginning of the session. Underperforming stocks included Flight Centre (-0.5 per cent to A$17.73), Webjet (-2.5 per cent to A$5.17) and Corporate Travel Management (-0.7 per cent to A$18.85). Sydney Airport, on the other hand, increased by 0.5 per cent to A$6.14 ahead of its March revenue figures which are set to come out later today.

According to the HIA New Home Sales report, new-home sales rose by 90.3 per cent in March, and by 42.6 per cent over the year. The surge was likely due to people making use of the A$15,000 HomeBuilder grant before it closed off at the end of March.

• For more information on the latest market moves, get in touch with Jarden.

Disclaimer: This Morning Brief has been prepared in good faith and reflects opinions and views at the time of publication, using external sources, systems and other data and information we believe to be accurate, complete and reliable at the time of preparation.We make no representation or warranty as to the accuracy, correctness and completeness of that information, and will not be liable or responsible for any error or omission.This Morning Brief is not to be relied upon as a basis for making any investment decision. Please seek specific investment advice before making any investment decision. Jarden Securities Limited is an NZX Firm, a broker disclosure statement is available free of charge at www.jarden.co.nz. Jarden is not a registered bank in New Zealand. Full disclaimer available at: https://www.jarden.co.nz/limitations-and-disclaimer

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