Chipmaker Nvidia drove the tech-heavy Nasdaq Composite higher as US President Donald Trump unveiled US$600 billion of commitments from Saudia Arabia during his trip to the Middle East, and as AI backer Softbank Group reported its first profit in four years.
US defence companies were more mixed after Trump announced plans to sell US$142 billion of arms to Saudi Arabia, and the blue-chip Dow Jones Industrial Average was dragged down by healthcare stocks as UnitedHealth Group slumped as it suspended earnings guidance and waved goodbye to its chief executive.
Meanwhile, softer-than-expected US inflation figures prompted the president push for the Federal Reserve to cut interest rates and weighed on the greenback, giving the kiwi dollar a boost.
And Australian online travel booking firm Webjet has attracted a bid for control from BGH Capital and Gary Weiss’s Ariadne Australia, while Winton Property’s proposed film hub near Arrowtown got added to the New Zealand’s government’s fast-track consenting list.
Bolstering trade
Stocks on Wall Street were mixed as investors remained optimistic after trade tensions between the US and China abated.
The Nasdaq was up 1.8% at 7am in Auckland, with chipmaker Nvidia surging 6.2% after Trump announced the Saudi commitments to US firms, including 18,000 Blackwell chips made by Nvidia.
Japan’s Softbank also reported its first profit in four years as it ramps up its AI investments.
Defence stocks were mixed, with Lockheed Martin and Northrop Grumman weaker while RTX gained, after Trump’s tour announced an arms package of almost US$142 billion, without providing details of which firms would benefit.
The blue-chip Dow Jones index fell 0.4% with UnitedHealth sinking 18% after the company withdrew earnings guidance and said chief executive Andrew Witty stepped down for personal reasons. That weighed on other health stocks.
Benign inflation
A more benign 2.3% pace of US inflation supported stock markets, coming in below expectations.
“In the aftermath of the Trump’s tariff U-turn that significantly de-escalated the US-China trade war, US equities have made further gains and US Treasuries have looked through the softer-than-expected US CPI report, with yields pushing higher,” Bank of New Zealand senior markets strategist Jason Wong said in a note. “Economists have already begun revising up their growth forecasts for the US and China and reduced the probability of the US economy entering a recession this year, alongside seeing less scope for the Fed to cut rates this year.”
The greenback reversed some of its gains after the China trade deal, with the kiwi climbing to 59.40 US cents at 7am in Auckland from 58.89 cents yesterday.
Meanwhile, Sweden said it plans to urge the European Union to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, and the Asia-Pacific Economic Cooperation group of trade ministers will meet in South Korea on Thursday, where they’re expected to discuss advancing free trade in the region.
In the antipodes
Australian futures are pointing to a 0.3% increase for the S&P/ASX 200 index today, with Commonwealth Bank of Australia expected to provide a trading update today.
Local data today include April spending on electronic cards, and March travel and migration figures.
Meanwhile, online booking platform Webjet last night said it’s received a non-binding indication of interest from BGH Capital to secure a controlling interest in the company, offering 80 Australian cents a share. The private equity firm has built up a near-11% stake working in concert with ASX-listed Ariadne.
And dual-listed Winton said its $200 million Ayrburn film hub near Queenstown will get a fast-track assessment under the government’s streamlined consenting regime.
Reporting by Paul McBeth. Image from ekrem osmanoglu on Unsplash.
