1 00:00:00,120 --> 00:00:03,440 Speaker 1: Shane Soli Harbor Asset Managements with us Allo Shane that 2 00:00:03,760 --> 00:00:06,000 Speaker 1: so what are the markets expecting from the Reserve Bank 3 00:00:06,000 --> 00:00:06,960 Speaker 1: in a couple of days. 4 00:00:07,440 --> 00:00:10,320 Speaker 2: Yeah, so, look, the market's fully fact in a zero 5 00:00:10,360 --> 00:00:13,159 Speaker 2: point two five percent cut in rates, so it take 6 00:00:13,240 --> 00:00:16,080 Speaker 2: us to two twenty five is official cash rate. In fact, 7 00:00:16,120 --> 00:00:18,680 Speaker 2: it's priced in a zero point two seven to two 8 00:00:18,760 --> 00:00:20,919 Speaker 2: twenty three of them. It's just the market's getting a 9 00:00:20,960 --> 00:00:23,400 Speaker 2: little bit ahead themselves. Maybe the main focus here will 10 00:00:23,440 --> 00:00:25,800 Speaker 2: be on how much the Reserve Bank of New Zealand 11 00:00:25,840 --> 00:00:29,080 Speaker 2: signals the possibility of further cuts. Does it come out 12 00:00:29,200 --> 00:00:33,400 Speaker 2: is just another round of cuts given inflations stable, but 13 00:00:33,640 --> 00:00:36,200 Speaker 2: unemployment growth is still modest, or does it actually indicate 14 00:00:36,240 --> 00:00:38,640 Speaker 2: that using cycle is over or close to over? I 15 00:00:38,640 --> 00:00:41,680 Speaker 2: should say, and let the cuts do the job of 16 00:00:41,800 --> 00:00:44,640 Speaker 2: really picking up the economy after quite a chunky series 17 00:00:44,640 --> 00:00:47,479 Speaker 2: of cuts of the last year or so. One thing 18 00:00:47,560 --> 00:00:49,080 Speaker 2: here that we need to keep watching for is this 19 00:00:49,320 --> 00:00:51,479 Speaker 2: the New Zealand doll It's pretty weak when you're a 20 00:00:51,520 --> 00:00:54,240 Speaker 2: five year old fifty six cents roughly against the US dollar. 21 00:00:54,800 --> 00:00:56,600 Speaker 2: Let's doing a lot of the work for the Reserve Bank. 22 00:00:56,720 --> 00:00:59,400 Speaker 2: So yeah, when we look forward, markets actually pricing and 23 00:00:59,440 --> 00:01:01,640 Speaker 2: official care straight head a low of two point one 24 00:01:01,680 --> 00:01:05,240 Speaker 2: percent in May twenty twenty six, So market thinks there's 25 00:01:05,240 --> 00:01:07,080 Speaker 2: going to be more rate cuts. That'll be the interesting 26 00:01:07,560 --> 00:01:08,640 Speaker 2: part of the discussion. 27 00:01:09,120 --> 00:01:12,000 Speaker 1: Now we're about halfway through the current company reporting season 28 00:01:12,040 --> 00:01:13,600 Speaker 1: here in New Zealand. Is the tone getting a little 29 00:01:13,600 --> 00:01:14,720 Speaker 1: bit more upbeat? Do you think? 30 00:01:15,440 --> 00:01:18,520 Speaker 2: Yeah? Yeah, we are halfway through. It's for the September period, 31 00:01:18,600 --> 00:01:23,160 Speaker 2: and so far we've observed more profit beats against consensus 32 00:01:23,160 --> 00:01:26,440 Speaker 2: market expectations and messes. That's pretty good. The last three 33 00:01:26,520 --> 00:01:29,319 Speaker 2: years we've actually been seeing more misses than beats, so 34 00:01:29,360 --> 00:01:30,760 Speaker 2: it feels like there's a little bit of a trend 35 00:01:30,840 --> 00:01:32,120 Speaker 2: change something interesting. 36 00:01:32,120 --> 00:01:32,240 Speaker 1: Now. 37 00:01:32,319 --> 00:01:35,560 Speaker 2: Obviously, up to September, the economy is pretty challenging and 38 00:01:35,640 --> 00:01:37,840 Speaker 2: some companies have been calling that out. So there's been 39 00:01:37,880 --> 00:01:42,039 Speaker 2: the odd little disappointment in terms of timing versus markets 40 00:01:42,080 --> 00:01:45,360 Speaker 2: investors getting hid themselves. But you know, really the underlying 41 00:01:45,400 --> 00:01:48,400 Speaker 2: results are looking okay. We're seeing some companies really delivering 42 00:01:48,440 --> 00:01:52,000 Speaker 2: on their own self help and those are the companies 43 00:01:52,000 --> 00:01:53,600 Speaker 2: that you know, when you look at it, they'll do 44 00:01:53,640 --> 00:01:55,920 Speaker 2: okay with the economy recovers in a hurry or not. 45 00:01:56,000 --> 00:01:58,440 Speaker 2: And that's where I think investors are starting to focus on. 46 00:01:58,920 --> 00:02:02,520 Speaker 2: Most companies are talking about. Since September, we've seen a 47 00:02:02,560 --> 00:02:06,000 Speaker 2: notable pickup in activity, so we are seeing an improven activity. 48 00:02:06,080 --> 00:02:07,880 Speaker 2: So maybe that trend continues. 49 00:02:07,920 --> 00:02:09,880 Speaker 1: Yeah, brilliant stuff. Now listen to the US markets. We've 50 00:02:09,880 --> 00:02:11,960 Speaker 1: got a bit weird last week. Where did things get 51 00:02:12,000 --> 00:02:13,120 Speaker 1: to over the weekend? Yeah? 52 00:02:13,440 --> 00:02:15,560 Speaker 2: Yeah, like so yeah? Good? Good points of the US 53 00:02:15,880 --> 00:02:17,680 Speaker 2: S and P five hundred, that's the main index we 54 00:02:17,720 --> 00:02:19,600 Speaker 2: all talk about. It was down about one point nine 55 00:02:19,600 --> 00:02:24,120 Speaker 2: percent last week. Manage you the technology stocks falling, some 56 00:02:24,200 --> 00:02:27,040 Speaker 2: risks around the US Federal Reserve not cutting rates in 57 00:02:27,120 --> 00:02:30,760 Speaker 2: weak consumer confidence. In comparison to zon market, she markers 58 00:02:30,760 --> 00:02:33,200 Speaker 2: on down zero point three. So we did our job 59 00:02:33,240 --> 00:02:36,560 Speaker 2: of protecting. But the US markets on Friday they bounced. 60 00:02:37,280 --> 00:02:39,880 Speaker 2: There was a couple of the US feed Reserve speakers 61 00:02:40,200 --> 00:02:42,760 Speaker 2: came out and suggested actually the central bank headroom to 62 00:02:42,880 --> 00:02:46,680 Speaker 2: ease cut rates, particularly given cool and labor markets, and 63 00:02:46,720 --> 00:02:49,079 Speaker 2: that actually saw the US market have a bit of 64 00:02:49,120 --> 00:02:51,960 Speaker 2: a flip and the needed stronger. So we've seen a 65 00:02:51,960 --> 00:02:53,839 Speaker 2: bit of a pricing and of a December rate cut 66 00:02:53,919 --> 00:02:57,080 Speaker 2: back to seventy percent. So the expectations seventy percent of 67 00:02:57,080 --> 00:02:59,840 Speaker 2: the markets expecting the US feed to cut in this 68 00:03:00,800 --> 00:03:03,640 Speaker 2: that's quite a big increase, assuming we're seeing a bit 69 00:03:03,680 --> 00:03:07,640 Speaker 2: of a bounce. US futures is showing that the US 70 00:03:07,639 --> 00:03:10,320 Speaker 2: market may be up zero point four percent tonight. Our 71 00:03:10,320 --> 00:03:12,200 Speaker 2: market here in his own was up zero point six 72 00:03:12,560 --> 00:03:14,240 Speaker 2: so a little bit of a better time coming. 73 00:03:14,080 --> 00:03:15,920 Speaker 1: At the end of the last week. Happy to hear that, Shane. 74 00:03:15,960 --> 00:03:18,040 Speaker 1: Thanks very much, Shane, Sally Harbor Asset Management. 75 00:03:18,600 --> 00:03:21,760 Speaker 2: For more from Heather Duplessy Allen Drive, listen live to 76 00:03:21,880 --> 00:03:24,880 Speaker 2: news Talks it'd b from four pm weekdays, or follow 77 00:03:24,919 --> 00:03:26,639 Speaker 2: the podcast on iHeartRadio.