Power Points: February 2019—Breaking Records

As the sector prepares to report 1H19 interim results, January 2019 has seen firm wholesale electricity prices

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Morning News Summary

Presidents’ Day Slows Market

The global markets had a slow day of trading as a result of the US markets being closed for a holiday. Europe posted mixed results, the UK was down, while Asia was well and truly in the green.

US stocks on pause

The US financial markets were paused on Monday in observance of Washington’s Birthday, a holiday declared by Congress in 1879.

European market mixed while UK falls

European stocks traded mixed on Monday but held onto a four-month high, as investors continued to await progress from trade negotiations between the US and China. The Stoxx Europe 600 rose by +0.2%. Leading the market, Wirecard jumped +15.2% after German market regulator BaFin banned the establishment or increase of short positions in the stock. Austria’s chipmaker Ams AG increased +3.6%, after a report the company is trying to diversify away from Apple’s iPhone. Faurecia’s (+1.5%) gain bucked the trend in the auto sector which fell -0.3%, lagging the market after data showed car sales in China fell for a seventh straight month. Notable auto companies Volkswagen and Daimler fell -1.5% and -0.4% respectively. Retailer Casino Guichard Perrachon fell -2.5% after a broker analyst cut their rating to hold from buy.

London markets were down on Monday, losing some of the advances they had made last week, with trading volumes likely lower due to the US holiday. The UK’s FTSE 100 fell -0.2%, after finishing up +2.3% last week. Investor concern remained over trade negotiation between US and China on difficult issues such as Washington’s dissatisfaction over Chinese technology and trade policies. Reckitt Benckiser jumped +4.4% and led the way in the FTSE, when the consumer goods company announced a surge in annual revenue and profit due to growth across key brands. The healthcare sector struggled, with notable losses coming from Hikma Pharmaceuticals (-2.3%), AstraZeneca (-1.4%) and GlaxoSmithKline (-0.6%). In banking, Barclays lost -0.8% after one of its biggest shareholders, Tiger Global, sold down its US$1bn stake in the bank. Lloyds Banking Group nudged down -0.2% and HSBC Holdings fell -0.3%. Meanwhile, miner Fresnillo rose +0.9% and Antofagasta added +0.4%. Micro Focus International gained +4.1% after it completed its acquisition of Interset to further expand cyber-security expertise.

Asia in the green

Asian markets kicked higher on renewed US–China trade hopes. The Shanghai Composite (+2.7%), Nikkei 225 (+1.8%), Hang Seng (+1.6%), Taiwan SE (+0.8%) and Kospi (+0.7%) all saw notable gains.

The ASX 200 closed up +0.4%, the highest value in seven sessions.

Crude, gold and iron ore all increased

WTI crude rose +2.2% to US$55.59, gold also rose +0.4% to US$1,326.23 and iron increased +1.0% to US$88.80/MT.

Today’s events

  • Heartland Group 1H19 result
  • NZME FY18 result
  • Precinct Properties 1H19 result
  • Tower AGM
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