Rocket Lab keeps flying as chipmakers buoy Wall St
Middle East stand-off persists as Trump says ceasefire is on life support.
Stocks on Wall Street eked out gains in late trading as the chipmakers including Nvidia, Intel and Micron Technology remained in favour, overshadowing increased nervousness about the Middle East conflict after US President Donald Trump said the ceasefire with Iran was on life support.
Local favourite Rocket Lab was among those surging higher, with brokers raising their price targets on the space company after its strong quarterly result last week as the looming SpaceX initial public offering puts the sector under the microscope.
Australian Treasurer Jim Chalmers will deliver his fifth federal budget today and is expected to announce tax changes on housing making it easier for young people to enter the property market alongside fiscal consolidation.
Wall Street’s chipmaker and semiconductor rally will keep dual-listed Infratil in focus, with futures pointing to a firmer day for both sides of the Tasman, while local data include Statistics New Zealand’s latest concrete-use figures, ANZ’s monthly traffic gauge and the government’s latest monthly accounts.
Keeping momentum
The Nasdaq Composite and S&P 500 nudged up 0.1% in late trading on Wall Street, with gains for chipmakers and semiconductor firms including Nvidia, Intel and Micron buoying the US market. Infratil led the S&P/NZX 50 index higher yesterday, catching the optimism about the artificial intelligence theme and hitting a new record.
Brent crude oil futures rose 2.9% to US$104.26 a barrel at 7am in Auckland after US President Trump said the ceasefire with Iran was on life support after its response to the White House’s peace proposal. The kiwi dollar rose to 59.661 US cents at 7am from 59.41 cents yesterday.
The volatility index – known as Wall Street’s fear gauge – rose 5.8% to 18.19 and the Polymarket prediction market was pricing in a 21% chance of a permanent peace between the US and Iran by the end of the month, and 42% by the end of June.
The Dow Jones Industrial Average was marginally higher, with Honeywell International, Caterpillar and Nvidia at the top of the leaderboard, while Nike, Walt Disney Co and International Business Machines were laggards.
That positive bias is set to seep through to the antipodes, with New Zealand’s S&P/NZX 20 index futures nudging higher yesterday, and Australian futures pointing to a 0.3% gain when trading opens across the Tasman.
“NZX 20 futures finished up 0.1% yesterday, suggesting a modestly firmer open, although higher oil prices and rising geopolitical tensions may keep some investors cautious,” Moomoo market strategy consultant Greg Boland said in a note. “After Monday’s 0.3% gain locally, Kiwi investors will be watching whether offshore momentum can push the market through recent resistance levels.”
Still flying
Rocket Lab hit a new record overnight, and was up 16% at US$123.30 in late trading, continuing its strength since reporting a better-than-expected quarterly result. Needham was the latest broker to raise its price target on the stock, lifting it to US$120 from US$95 and keeping its ‘buy’ rating, with the broader space sector rallying amid expectations for a SpaceX IPO in the coming months.
“For Kiwi investors, Rocket Lab’s continued momentum remains important given its growing local investor following and what it says about appetite for high-growth names globally,” Moomoo’s Boland said.
The kiwi dollar traded at 82.24 Australian cents at 7am from 82.20 cents yesterday ahead of Treasurer Jim Chalmers’ federal budget, with a housing policy set to be the centrepiece of the policy dump.
Local data include Stats NZ’s concrete-use data, which will be useful to measure volumes for materials firms such as Fletcher Building, while ANZ’s Truckometer gauge will show monthly traffic for logistics firms including Freightways and Mainfreight.
The government will release its financial statements for the nine months ended March 31.
And, justice minister Paul Goldsmith today said the government will change climate change laws to prevent a liability finding in tort for damage or harm caused by greenhouse gas emissions, with the legislation cutting across an existing case before the courts taken against Fonterra Cooperative Group, Genesis Energy, Dairy Holdings, New Zealand Steel, Z Energy and BT Mining.
Reporting by Paul McBeth. Image from Maxence Pira on Unsplash.
