Stocks on Wall Street were mixed with investors taking a breather as the ceasefire between Israel and Iran continues to hold, while US President Donald Trump plans to hold a meeting with Iran next week.
US Federal Reserve chair Jerome Powell continued his testimony before legislators, reiterating his view that the White House’s tariffs are top of mind for the central bank in monitoring any signs of prices picking up.
Meanwhile, British oil giant Shell played down speculation it’s started talking to BP about buying the smaller rival.
And New Zealand finance minister Nicola Willis has given a serve to supermarkets over pricing issues, and is considering stiffer penalties for breaches of the Fair Trading Act.
Wait and see
The S&P 500 was largely flat in late trading as trading settled down with the ceasefire in the Middle East appearing to hold firm. US President Donald Trump said he plans to meet with Iran next week, while questioning whether a new deal on the nation’s nuclear programme is needed given his claims that the facilities were destroyed.
“Market conditions are relatively calm with only modest price action, with a lack of newsflow and investors believing that the war between Iran and Israel is largely over for now,” Bank of New Zealand senior markets strategist Jason Wong said in a note.
Meanwhile, NATO leaders pledged to meet Trump’s demands to raise their military spending, spurring on gains among defence companies even as European stock markets were broadly weaker.
Australia’s Droneshield surged almost 20% on the ASX yesterday after securing its biggest contract from an unnamed military client in Europe.
The kiwi dollar traded at 60.39 US cents at 7am in Auckland from 60.28 cents yesterday as US Fed chair Jerome Powell continued his testimony before US policymakers, telling a Senate panel the risk of inflation from Trump’s tariff regime remains a big risk and putting the central bank off cutting rates for now.
Separately, the Fed revealed a proposal to reduce the capital requirements for lenders. New Zealand’s Reserve Bank is currently reviewing its own capital requirements for banks.
Deal chatter
Shell dipped in US trading after the Wall Street Journal reported the oil major was holding early talks with BP to acquire its smaller rival, whose shares pared earlier gains to be up 1.8%. Shell played down the report, denying talks were taking place.
The Nasdaq continued to nudge higher, edging up 0.2% in late trading as chipmaker Nvidia hit a new record. Meanwhile, Tesla shed 4.4% after reporting a decline in European sales.
US rental campervan firm Winnebago Industries sank 7.3% in late trading after cutting its outlook for the year with soft consumer demand sapping its sales of RVs. NZX-listed Tourism Holdings – which is under a takeover bid from BGH Capital and cornerstone shareholder, the Trouchet family – has experienced similar soft sales.
Australian futures are pointing to a 0.5% decline for the S&P/ASX 200 index, while New Zealand’s S&P/NZX 50 index has dropped for six straight sessions – its longest run in the red since February.
Travel software developer Serko is holding its annual meeting in Auckland today.
Meanwhile, finance minister Nicola Willis has written to New Zealand’s major supermarkets, warning them that they need to meet fair trading rules and seeking an update from operators on steps they’re taking to address pricing issues.
“I am disappointed that I have to spell out to some of New Zealand’s biggest and most sophisticated retail operators – Foodstuffs North Island, Foodstuffs South Island, and Woolworths – that they should have in place processes to prevent inaccurate pricing, institute and publicise refund policies, and train staff to ensure that when errors are reported, fixes occur system-wide,” Willis said in a statement. “Compliance with the law should be a basic expectation.”
Willis is considering tougher penalties for breaches of the Fair Trading Act.
Reporting by Paul McBeth. Image from Jorge Alcala on Unsplash.
