Kiwi Property, Gentrack earnings loom as bond market groans

The domestic shoulder earnings season kicks on this week after rising government bond yields sent a chill through US and European markets on Friday, with commercial landlord Kiwi Property Group expected to deliver robust annual earnings growth when it lifts the veil today, while utilities software developer Gentrack’s first-half result should deliver more detail on its recent earnings downgrade.

The main event on Wall Street this week is Nvidia’s quarterly result on Wednesday in the US, while earnings from retailers Walmart and Home Depot will provide more clues to the consumer sentiment in the world’s biggest economy.

Reports that SpaceX will launch an initial public offering as early as June 12 has analysts expecting a filing from the space giant this week, keeping the broader industry in the spotlight including local favourite Rocket Lab, which snapped a five-day rally as it declined on Friday.

Meanwhile, local data today include the Bank of New Zealand-BusinessNZ’s latest gauge of services sector activity, which fell deeper into contractionary territory in March.

Market tremors

Australian futures are pointing to a 0.4% decline for the S&P/ASX 200 index when trading opens across the Tasman after a soft lead from Wall Street on Friday as rising bond yields and elevated oil prices sapped investors’ appetite for riskier assets.

The yield on the 10-year US Treasuries rose 7 basis points to 4.6% on Friday, while Brent crude oil futures were up 3.3% at US$109.24 a barrel after US President Donald Trump’s summit with his Chinese counterpart Xi Jinping failed to deliver any meaningful progress on expanding traffic through the Strait of Hormuz.

The Polymarket prediction market is pricing in just an 8% chance of the US and Iran reaching a permanent peace deal by the end of this month and a 27% chance by the end of June.

“New Zealand equities are likely to open weaker today after a sharp selloff on Wall Street and continued pressure across global bond markets,” Moomoo market strategy consultant Greg Boland said in a note. “The S&P/NZX 50 Index fell 0.5% on Friday, its fourth straight decline, and with US futures weaker, oil prices rising, and bond yields hitting fresh highs, local sentiment may remain cautious at the open.”

The domestic earnings season picks up pace this week, with the heavyweights clustered next week.

Commercial landlord Kiwi Property is expected to report a 10% increase in annual adjusted funds from operations and lift its forecast dividend for the upcoming March 2027 year, while Gentrack’s first-half result is predicted to provide more details on the profit warning it issued earlier this month when the shares tumbled by more than a third.

Chips on the table

Nvidia’s first-quarter result will be the key focus for Wall Street this week after the recent revival in the artificial intelligence trade, which helped propel NZX-listed Infratil to new highs in recent weeks.

Earnings from Walmart and Home Depot are also in view, while Intuit’s update will come on the radar for Xero watchers after the ASX-listed accounting software firm’s annual result last week.

The space sector is anticipating a regulatory filing from SpaceX this week after reports that Elon Musk’s rocket and satellite maker is eyeing an initial public offering as soon as June 12. Local favourite Rocket Lab surged last week after beating earnings expectations, although it gave back some of those gains on Friday in the broader selloff, falling 5.9% to US$124.77.

The Dow Jones Industrial Average fell 1.1% on Friday, led lower by Nvidia, Boeing and Caterpillar, with the S&P 500 down 1.2% and the tech-heavy Nasdaq Composite sliding 1.7%.

European markets were hit harder, with the UK’s FTSE 100 down 1.7%, Germany’s DAX falling 2.1% and CAC 40 sliding 1.6%.

The kiwi dollar fell to 58.43 US cents at 7am in Auckland from 58.72 cents last week in the nervous environment.

Local data today include the BNZ-BusinessNZ performance of services index, which is expected to remain soggy as the Middle East conflict saps the domestic economic outlook. The Reserve Bank’s monthly update on foreign holdings of government bonds is also in view.

Property for Industry sheds rights to its third-quarter dividend today.

Reporting by Paul McBeth. Image from Curious News.