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Speaker 1: Shane. Sally Harbor Asset Management is with us now. Hey Shane,

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Speaker 1: Hey here, So Shane, the US markets have given back

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Speaker 1: some of the games since the election. Again, since the election,

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Speaker 1: when you think it's going to continue to be choppy.

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Speaker 2: Well, I look, we've seen last week the US S

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Speaker 2: and P five that's the board, broad Benchmark's down two percent.

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Speaker 2: Tech stocks they were down three percent, And it's all

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Speaker 2: about we're seeing an unwind of this Trump trade, this

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Speaker 2: losing steam. Federal Reserve came out and said we're not

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Speaker 2: going to cut quite as fast as we thought. So

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Speaker 2: the odds of a cut from the US FED that

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Speaker 2: really back down before last week eighty percent of a cup.

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Speaker 2: Now they're talking about fifty eight percent next month. So

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Speaker 2: certainly that's taken some heat out and this initial you

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Speaker 2: for around mister Trump's appointment, we've seen some people come

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Speaker 2: to the terms that there's a cost, and that's possibly

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Speaker 2: higher fiscal spending, higher a budget divisits, but more inflation.

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Speaker 2: S Bonds, particularly the US tenure bonds go right back

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Speaker 2: up to four point four percent. We saw that back

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Speaker 2: in April. So a lot of this team's coming out

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Speaker 2: is it choppy? Well, last few months of the month, sorry,

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Speaker 2: last few months for the year, I should say generally

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Speaker 2: good for US markets. But what we're seeing is earnings

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Speaker 2: start to get cut for the American market and the

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Speaker 2: tech stops they're the ones that have been holding up.

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Speaker 2: They were really weak late last week. But this is

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Speaker 2: the broader market. Is this earnings momentum that's been driving

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Speaker 2: the US market starting to fade some of the costs

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Speaker 2: that so they were associated with the provoking government come in.

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Speaker 2: So yeah, there's a bit of risk, it could be

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Speaker 2: a bit choppy.

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Speaker 1: Yeah, what are you expecting. We've got our own Reserve

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Speaker 1: Bank review of the OCR this month. What are you

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Speaker 1: expecting there?

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Speaker 2: Well, market's telling me they're expecting half a percent, So

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Speaker 2: I've got to go with what the market consensus to saying. So,

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Speaker 2: you know, the lead indicata is is justing confidence. Business

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Speaker 2: confidence starting to come off a low base, but it

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Speaker 2: is still really low. We are seeing inflation pressure continued

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Speaker 2: to fall, so that the right backing is there for

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Speaker 2: the RB and Z to continue to cut. Today we've

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Speaker 2: had some slightly more positive data out of the b

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Speaker 2: Z business in z PSI. So and that's assumer that says,

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Speaker 2: how are you feeling about what happens next. Is up

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Speaker 2: from up to forty six up points three percent, so

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Speaker 2: not a lot. Still below fifty and fifty years above fifty.

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Speaker 2: That means that economy is going to grow. If it's

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Speaker 2: below fifty, it's going to shrimp. So business is still saying, hey,

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Speaker 2: we're dealing with this slow down. And we also saw

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Speaker 2: some inflation data out today, some producer price data. I

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Speaker 2: won't go into the detail, but it basically said businesses

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Speaker 2: are unable to pass through all the cost increases. So yeah,

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Speaker 2: there's certainly a lead up for the RBS and to

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Speaker 2: continue to cut. The surprise would be if it was

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Speaker 2: a quarter of three quarters of a percent off it's

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Speaker 2: point seventy five percent, that would be a surprise. But

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Speaker 2: this is the last time before February next year the

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Speaker 2: Reserve Bank can make a statement they've got a big break.

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Speaker 2: So yeah, the past, the less regrets is what they're

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Speaker 2: talking about. They want to keep some gas in the

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Speaker 2: tank just in case they have to fight inflation more so,

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Speaker 2: my guess is that'll be what they do. Half a

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Speaker 2: percent and we're going to keep someone in the back

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Speaker 2: pocket just in case.

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Speaker 1: Hey, by the way, anything come out of that. The

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Speaker 1: Fonterra and your shareholders meeting today.

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Speaker 2: Look, you know, Fira, it's been a really good story.

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Speaker 2: That company has done a great job of repositioning. They

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Speaker 2: reaffirmed their earnings for Coast, gave similar guidance between forty

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Speaker 2: to sixty cents, but she that's for the Fonterra Shielders

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Speaker 2: Foundation and that compares to the market expectation of fifty

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Speaker 2: three cents. Stock was flat on the day, not bad.

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Speaker 2: The board was just saying, hey, look we're seeing another

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Speaker 2: year of stable performance. We're focused on keeping the return

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Speaker 2: on capital up. There have been battling to get the

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Speaker 2: return on capital back up to ten to twelve percent

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Speaker 2: from nine to ten, and they're saying, hey, we're going

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Speaker 2: to keep on focusing on investing for the future. Now.

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Speaker 2: One of the things that people were watching for is

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Speaker 2: if there's any update on the sale of the global

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Speaker 2: consumer business, and there it was none other than to

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Speaker 2: say the board was saying, it's the right strategy, we're

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Speaker 2: on track, we're doing the process, we're underway. Just be patient.

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Speaker 2: So not new, but the confirmation and the less was

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Speaker 2: pretty important for the broad and New Zealand economy.

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Speaker 1: Yeah, brilliant. So Hey Shane, as always, thank you so much.

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Speaker 1: We talk to you in a week that Shane solely

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Speaker 1: of Harbor Asset Management. For more from Heather Duplessy Allen Drive.

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Speaker 2: Listen live to News Talk Said Be from four pm weekdays,

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Speaker 2: or follow the podcast on iHeartRadio