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Speaker 1: Jeremy Hutton's with US Milford Asset Management for our market update. Jeremy,

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Speaker 1: good evening.

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Speaker 2: Good evening, Ryan, how are you going very good?

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Speaker 1: Thanks? Can we start in the US? SO market's back

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Speaker 1: open overnight after the public holiday Monday. Bit of a

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Speaker 1: wobbly over Greenland and Trump.

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Speaker 2: Yeah, that's right. The Cell America trade was back on

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Speaker 2: last night, and the Nasdaq SMP five hundred indexes both

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Speaker 2: down two percent, and our own z X down over

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Speaker 2: one percent as well. So, yeah, a bit of a wobbly.

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Speaker 2: And most importantly that US ten year bond that's broken higher,

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Speaker 2: and you know that's interest rates going up, which is

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Speaker 2: never really a good sign for markets, and politicians start

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Speaker 2: to get nervous too. So maybe even that rate we'll

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Speaker 2: contain some of President Trump's tendencies at the moment.

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Speaker 1: Yeah, right, Let's go to New Zealand and Zero. This

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Speaker 1: is accounting software business. Of course, everyone knows that sheer

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Speaker 1: price has been under some pressure, fell under the psychological

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Speaker 1: one hundred dollars level. What is going on?

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Speaker 2: Yeah, Regarded as one of New Zellen's great companies, Zero

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Speaker 2: is going through a bit of a lean pad of

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Speaker 2: late this year. Price is almost halved from its one

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Speaker 2: hundred and ninety three dollars peak in June last year,

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Speaker 2: So in just six months it's halved, and it started

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Speaker 2: twenty twenty six pretty poorly as well, down over sixteen percent.

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Speaker 2: So yeah, painful for ZERO investors generally accustomed to lots

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Speaker 2: of success, but Zero has been caught up in a

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Speaker 2: bit of this global software sell down and the sentiments

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Speaker 2: really struggling. And as effectively, it's these recent AI models

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Speaker 2: and they're getting very good at producing basic and good

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Speaker 2: looking software packages that pretty much the touch of a button.

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Speaker 2: So you know, some market commentators out there, they're even

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Speaker 2: calling it a potential existential threat to software and SaaS businesses.

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Speaker 2: So Zero is getting a little bit tied up with that.

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Speaker 2: We will follow that this year, you know, as the

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Speaker 2: AI models continue to develop and get a bit smarter,

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Speaker 2: we'll see what the impact will have on these software businesses.

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Speaker 1: He was also they did a big act because psition

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Speaker 1: out of the US, didn't they last year, and that

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Speaker 1: hasn't been received well either.

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Speaker 2: Yeah, more stock specific issue, but it hasn't helped the sentiment.

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Speaker 2: They bought this US payments business called Media paid a

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Speaker 2: princely some of two point five billion US dollars, so

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Speaker 2: a big chunky amountain and the market's given that feedback

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Speaker 2: pretty clearly that perhaps they paid a little bit too

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Speaker 2: much for it. But to be fair, you know, the

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Speaker 2: US it's always been been a key geography for zero

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Speaker 2: to expand into, and also payments as a technology or

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Speaker 2: addition to their product. That's that's been the radar too.

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Speaker 2: But perhaps they could have done it a little bit

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Speaker 2: more efficiently. So the market is taking its time to

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Speaker 2: digest this transaction and figure out if it was a

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Speaker 2: good deal or not.

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Speaker 1: Jeremy, does that mean we should all go out and

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Speaker 1: buy shares then.

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Speaker 2: Well that's a million dollar question, Ryan. But you know,

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Speaker 2: no doubt that Zera remains a very high quality company.

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Speaker 2: It's got some great growth runway ahead of it, and

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Speaker 2: we know it's had a lot of success in New Zealand, Australia,

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Speaker 2: in the UK. If it cracks the US market in

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Speaker 2: its core accounting software, or if this payments expansion goes well,

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Speaker 2: then the share price could perform really really strongly. You know,

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Speaker 2: sometimes markets get a little bit nervous and these great

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Speaker 2: opportunities can pop up, but the pressure's really on on

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Speaker 2: the zero management team to restore some of this confidence

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Speaker 2: and get and get the share price moving again.

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Speaker 1: Appreciate that, Jeremy. Thank you, Jeremy Hutton from Milford. You're

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Speaker 1: on news Talk Said.

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