Latest / Best of Business / Shane Solly: Harbour Asset Management expert on the market reactions to the ongoing tensions in Ukraine

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Shane Solly: Harbour Asset Management expert on the market reactions to the ongoing tensions in Ukraine · Best of Business

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  Speaker 1: You're listening to a podcast from Newstalk ZB. Follow this
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  Speaker 1: and our wide range of podcasts now on iHeartRadio. Shane Solley,
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  Speaker 1: Harbour Asset Management, is with us. Hi, Shane.
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  Speaker 2: Yeah, hi, Heather. Right.
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  Speaker 1: How have the markets reacted to the ongoing business in
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  Speaker 1: Ukraine and the Straits and then the weakness in the
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  Speaker 1: tech shares on Friday as well?
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  Speaker 2: Yeah, pretty messy out there. So markets moved to a
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  Speaker 2: bit more of a defensive mode today. Investors sort of de-risking.
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  Speaker 2: So just to back up, US share market a bit weak.
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  Speaker 2: On Friday, technology stocks down. Investors really questioning whether the
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  Speaker 2: AI demand, revenue, profitability, whether it's enough to support the
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  Speaker 2: trillions of dollars going into this AI compute capacity. What
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  Speaker 2: we have seen is today, sorry, US 10-year gamma bond,
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  Speaker 2: they were down slightly on Friday to 506. US 10-year
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  Speaker 2: gamma bonds today, 501 flat. And that's all about investors
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  Speaker 2: trying to find somewhere to hide out. We've actually seen
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  Speaker 2: an interesting thing today. The tick-sensitive Korean share market is
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  Speaker 2: actually up. We've also seen the Aussie share market actually up,
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  Speaker 2: and it's been boosted by a couple of takeovers, one
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  Speaker 2: for Chandra and one for Klinaway. Here in New Zealand,
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  Speaker 2: our share market down 0.7% due to weakness in Infratool,
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  Speaker 2: Meridian and Chorus. We're actually seeing US share market futures up.
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  Speaker 2: They're rebounding from Friday's low. A fall in oil prices
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  Speaker 2: down about 1.7% today, and a bit of anticipation that
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  Speaker 2: results from Meta and Tesla later this week might actually
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  Speaker 2: put a bit more positive news back in the tech trade.
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  Speaker 2: So there's some signs of improvement already.
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  Speaker 1: Now, why was the Infratool share price so weak today?
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  Speaker 2: Yeah, good question. So one of Infratool's largest investments is
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  Speaker 2: a holding in a business called Canberra Data Centres. Weak
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  Speaker 2: technology sentiment on Friday might not have helped, but we
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  Speaker 2: think the main reason that the Infratool share price fell 5.1%
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  Speaker 2: today was because one of CDC or Canberra Data Centres' competitors,
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  Speaker 2: a business called NextDC, had to put its shares into
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  Speaker 2: trading halt in Aussie as it assesses the impact of
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  Speaker 2: a delay to the supply of power at its M3
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  Speaker 2: Melbourne data centre. This is a problem globally, that there's
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  Speaker 2: a pushback on getting power and getting hard to get
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  Speaker 2: power into data centres. So we think those problems are
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  Speaker 2: very much about Next DC, not about Infratool's Canberra data
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  Speaker 2: centre's growth rate. So we're not actually at this stage
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  Speaker 2: worried about it. It's not a Canberra data centre issue.
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  Speaker 1: And listen, on the economic data that we got today,
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  Speaker 1: a bit mixed, do you think?
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  Speaker 2: Yeah, look, you know, the services index for September month,
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  Speaker 2: that was down 0.1% to 50.9. So it's positive. It's
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  Speaker 2: above 50. We'll take that. But it's suggesting that that
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  Speaker 2: recovery in the services sectors is pretty modest, certainly not
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  Speaker 2: as good as last week's manufacturing sector numbers. We had
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  Speaker 2: New Zealand September trade deficit. We're at 1.971 billion. Sounds
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  Speaker 2: like a big number. It is. But it's a bit
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  Speaker 2: of a data gap. bump there we've dropped a good
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  Speaker 2: number from the start of the period actual underlying data
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  Speaker 2: was quite good export values holding up imports not so
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  Speaker 2: bad so not so bad and then finally we had
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  Speaker 2: a really good chinese gdp number that's important for new
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  Speaker 2: zealand it actually beat expectations for the september quarter up
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  Speaker 2: 4.5 versus 4.4 big one this week here there is
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  Speaker 2: cpi new zealand inflation on wednesday that'll influence sorry on
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  Speaker 2: thursday i should say that'll influence whether the rbnz hikes
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  Speaker 2: rates later this month. So let's hope it's 3.9 or less. Oh, brilliant. Okay.
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  Speaker 1: We'll look out for that. Shane, thank you very much.
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  Speaker 1: Shane Solley, Harbour Asset Management.