Here are the key things you need to know before you leave work today.
UPGRADE UPDATE:
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MORTGAGE RATE CHANGES
No changes to report today.
TERM DEPOSIT RATE CHANGES
Treasury has raised the rates in its risk-free Kiwi Bond deposits by +0.20%, from next to nothing to not much. The highest rate is for a 4 year term at 0.90%. Also, the Police Credit Union raised some TD rates today.
SOME BRANCH REOPENINGS
ANZ said it will re-open some branches this week for essential transactions.
REDUX
BNZ is reporting that their very early internal card transaction data show a broadly similar overall impact from the delta lockdown compared to the major lockdowns of 2020. But they speculate that we are more comfortable shopping online now.
ANOTHER BOX TICKED
NZ Refining now has deals with Z Energy, BP, and now Mobil for its Marsden Point restructuring away from it being an oil refinery. Those are its three largest customers (and shareholders), so there is no going back now. Their board of directors is due to give the final tick for this transition in about a month. The new type of operation should comment in mid-2022.
SHINING A LIGHT ON BANKS
We have updated our bank comparisons page here showing leverage, profitability, and asset levels for almost all retail banks. Banks remain very highly leveraged despite RBNZ long-term efforts to restrain that sort of financial engineering. The best big bank is ASB, the worst is Kiwibank.
FUNDS FLOW FREER
There was more activity in the RBNZ's Funding for Lending program last week, with more than $500 mln drawn, taking the August total to $2 bln, and the overall total to $5.7 bln of the $28 bln allocated.
INVESTING IN OLDIES
Last week, stock market investors decided that the four listed retirement home stocks were worth having, bidding up their value by +7.1% in the week, and now +26% in a year. Last week, Summerset's capitalisation rose +16.7% on its own to lead the charge. (SUM, #14). This small sector now represents 9.0% of the overall NZX50 capitalisation, up from 7.9% a year ago.
NEED MORE FUNDS TO INVEST IN OLDIES
Oceania Healthcare (OCA, #32) today announced it is seeking up to $100 mln via a seven year secured fixed rate bond issue to New Zealand institutional and retail investors. This bond will pay at least 1.45% over the 7 year swap rate.
NOT ALL BAD
In Japan, new data out today shows retail sales rose for a fifth straight month in July, beating expectations as the consumer sector continued its recovery, although the August pandemic resurgence has cast doubts over the spending outlook.
PANDEMIC PRESSURE STAYS INTENSE
There were another 1290 new community cases in NSW today with another 1145 not assigned to known clusters, so they remain completely out of control. They now have 16,866 locally acquired cases. Despite that, they are mulling easing further restrictions. Madness. Victoria is reporting another 73 new cases today, so it is still bad there too and their lockdown is extended. Queensland is now reporting two new cases. ACT has 21 new cases. Overall in Australia, more than 34% of eligible Aussies are fully vaccinated, plus 24% have now had one shot so far. There were only two new cases in New Zealand at the border, but 53 more in the community, all in Auckland. So far, 28% of eligible Kiwis now have both shots, another 23% the initial shot.
GOLD STABLE
Compared to where we were at the end of trading last week, the gold price is down just -US$3 at US$1814 in early Asian trade.
EQUITIES POSITIVE
The NZX50 is up +0.9% led by Sky TV, up +4%, Heartland Bank and Synlait both up +3%, and Mainfreight up +2.4%. The ASX200 is up a minor +0.1% in early afternoon trade. Tokyo has opened up +0.3%, Hong Kong and Shanghai have both opened up +0.4%. The S&P500 futures index points to a Wall Street opening flat tomorrow in its Monday session. The better-than-expected earnings reports are all priced in.
SWAP & BONDS RATES ON HOLD
We don't have today's closing swap rates yet. They have probably little-changed. We will update this if there are significant changes when the end-of-day data comes through. The 90 day bank bill rate is unchanged at 0.46%. The Australian Govt ten year benchmark rate is at 1.19% and little-cha+4 bps). The US Govt ten year is now at 1.31% and unchanged from where we opened this morning.
NZ DOLLAR LITTLE-CHANGED
The Kiwi dollar is now at 70.1 USc, and the same as where we opened this morning. Against the Aussie we are marginally softer at just under 95.8 AUc. Against the euro we are also slightly lower too at 59.3 euro cents. The TWI-5 is now at 73.2 and still near the middle of the 72-74 range we have been in for ten months.
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BITCOIN SLIPS
The bitcoin price is now at US$48,616 and virtually unchanged from where we opened this morning. Volatility in the past 24 hours has been low at +/- 1.7%.
This soil moisture chart is animated here.
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