Yovich & Co. Weekly Update - 10 December 2012

Dec 10, 2012 | Commentary

This Weeks Themes

  • The New Zealand Market consolidated on the recent rally to finish the week slightly down on the previous week which was a post GFC high.
  • The U.S. markets were mixed with the tech stocks on the NASDAQ pulling the index down after a 6% bull run leading into Thanksgiving.
  • The latest employment report from the U.S. draws a portrait of an economy growing steadily at 2% a year and adding an average of 150,000 jobs a month. Yet the U.S. would have to expand at a much faster clip and create jobs at twice the current rate to get the economy back on the same growth path as before the 2007-2009 recession struck.
  • European stocks rallied for a third week, climbing to an 18-month high, amid increasing optimism that China’s economy will sustain it’s recovery and U.S. lawmakers will reach a compromise to avoid a fiscal deadlock.
  • The NZD is threatening to break out from its current trend with the Kiwi trading towards 84 U.S. cents after Graeme Wheeler made an announcement that was more hawkish than expected.
  • In contrast, The Reserve Bank of Australia dropped rates by 0.25% to 3% with reference made to the high value of the Australian dollar and the slow down in the resource sector as reasons for the dovish statement.

Investment News

A2 Corporation Limited (ATM.nz) – Capital Raising and listing to the NZX Main Board:

A2 announced last week that they had completed an equity raising of $20 million in new shares and a partial sell down by the company’s largest shareholders with a total of NZ$70 million of existing shares sold at NZ$0.50 per share. ATM’s Managing Director Geoffrey Babidge said the equity raising and change of listing would position the company to accelerate the global growth initiatives outlined in the recently announced strategic review and provide additional liquidity. Last month when ATM announced the results of the strategic review, the company confirmed it would continue to be "capital light," relying on partnerships to drive it’s growth into new dairy markets and categories.

Seasons Greetings

With Christmas just around the corner, this will be my last newsletter for the year. Yovich & Co. will be closing Friday 21 December and reopening Monday 7 January 2013. We would like to wish you a very Merry Christmas and a prosperous New Year.

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About the author



Jarrod Goodall



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