Defence manufacturers such as Rheinmetall and Hensoldt were among gainers in European stock markets as the prospect of peace between Russia and Ukraine stumbled after Russian President Vladimir Putin spurned talks with his counterpart Volodymyr Zelenskyy.
Meanwhile, Wall Street was mixed as UnitedHealth Group tumbled amid reports of a criminal investigation into the insurer and Walmart dipped on plans to hike prices, while Cisco Systems rallied on an upbeat forecast and Foot Locker surged on a takeover offer.
Meta Platforms dropped after the Wall Street Journal reported it’s delaying the rollout of its latest artificial intelligence model.
And the Reserve Bank of New Zealand’s survey of inflation expectations will come into view as traders pare back their bets on how aggressively domestic interest rates will come down.
No show
Optimism about peace talks between Ukraine and Russia faded after Vladimir Putin decided not to turn up to the meeting he proposed, sending officials seen as a second-tier team.
US President Donald Trump told reporters in the Middle East that nothing’s going to happen until he meets with Putin.
Defence stocks advanced, helping drive gains in European stock markets, with Germany’s DAX up 0.7%. Rheinmetall rose 5.7% and Hensoldt was up 8.8%.
The UK’s FTSE 100 index rose 0.6% after the UK’s economy grew 0.7% in the March quarter, beating expectations. The kiwi dollar fell to 44.16 British pence at 7am in Auckland from 44.59 pence yesterday.
Across the Atlantic, Wall Street was mixed as the Dow Jones Industrial Average rose 0.6% in late trading while the Nasdaq Composite slipped 0.3%, with Cisco System climbing 5% as the AI boom prompted it to raise its forecast.
Meanwhile, Meta was down 2.1% after the Wall Street Journal reported the Facebook owner is struggling to improve its Behemoth AI model, delaying its rollout.
Tariff pains
Walmart was softer after the retail giant said it will raise prices due to Trump’s tariff regime, and UnitedHealth extended its slump amid reports it’s facing a criminal probe by the Justice Department.
And Foot Locker surged 85% after Dick’s Sporting Goods lobbed in a US$2.4 billion takeover bid for the retailer.
US economic data was broadly softer with producer prices falling 0.5% in April, its biggest monthly decline in five years, while retail sales were flat.
US Federal Reserve chair Jerome Powell warned global inflation might be more volatile with the chance of more frequent and persistent supply shocks.
“US economic data were mostly weaker than expected on both inflation and activity and these economic releases had an impact on the market,” Bank of New Zealand senior markets strategist Jason Wong said in a note “The market is back to pricing about 55 basis points of Fed rate cuts this year, up from 49 basis points at yesterday’s close.”
Australian futures are pointing to a 0.9% increase for the S&P/ASX 200 index today, while the kiwi dollar slipped to 58.73 US cents at 7am from 58.93 cents yesterday.
Local data today include the Reserve Bank of New Zealand’s survey of expectations, and the BNZ-Business NZ performance of manufacturing index.
Electricity generator Manawa Energy, which was cleared to be bought by larger rival Contact Energy, will report its annual earnings today.
Reporting by Paul McBeth. Image from Artem Maltsev on Unsplash.