The RBA Pull a Rabbit Out of the Hat 🪄🐇 🎩

October 05, 2022

Good Morning,

University staff in New Zealand will stage a half-day strike on Thursday, the RBA lifted rates by 25 basis points, Australian Post has entered the broadband market, US manufacturing activity grew at its slowest pace in two and half years, Nestle has committed $1B to protect coffee from climate change, and the markets had a great day.

Let's jump in.

Before The Bell

Markets

  • It was a strong day for the stock markets.

    • The New Zealand market was up on the back of a jubilant Wall Street.

    • The Australian market railed up 3.8% on the back of a smaller-than-expected rate hike from the RBA. Which helped alleviate recession anxiety. (AFR)

    • The US markets rocked up on the back of weaker-than-estimated US manufacturing data, which supported a dovish approach by the Federal Reserve. (BBG)

    • The UK market and pound were up on the back of the u-turn on the 45% tax rate cut. (RT)

  • Treasury and Government bond yields were down globally as investors believed the Fed might take a more cautious approach on the back of the smaller rate rise by the RBA and US manufacturing data. (RT & AFR)

  • What to watch out for this week:

    • The Reserve Bank of New Zealand's OCR decision is today.

    • The OPEC+ meeting starts today.

    • US factory orders and durable goods data are out today.

    • Fed personnel are speaking throughout the week at events.

    • More data out of the US and Eurozone is coming later in the week, including unemployment data.

News Summary

  • There is a nationwide recall of Pams frozen berries in New Zealand as Hepatitis A infections rise. (Stuff)

  • University staff in New Zealand will stage a half-day strike on Thursday. (Stuff)

  • ANZ and Kiwibank are rejigging their credit card reward schemes. (Stuff)

  • There has been a rise in personal loans in New Zealand, with figures in August being at a 10-month high. (Stuff)

  • Auckland rail commuters face a year of major disruptions next year. (Herald)

  • The Reserve Bank of Australia lifted rates by 25 basis points to 2.6%. (AFR)

  • The National Australia Bank, Westpac and ANZ have matched the RBA lift in rates for mortgage holders. (AFR)

  • The Victorian Government is building a new hospital in what it claims to be the biggest hospital project ever in Australia. (9 News)

  • Australian Post has entered the broadband market. (9 News)

  • UK Chancellor Kwasi Kwarteng will set out his debt plan earlier than previously announced. (BBC)

  • Ukraine has made further breakthroughs in the south and regained more territory. (BBC)

  • US manufacturing activity grew at its slowest pace in two and half years, with the manufacturing PMI down 1.9 points to 50.9 in September. (RT)

  • Apple iPhone exports from India top $1B (USD) in 5 months. (RT)

  • North Korea has fired a ballistic missile over Japan. (BBC)

  • Nestle has committed $1B (USD) to protect coffee from climate change. (BBG)

Deal Flow

Investments/ M&A

  • HSBC is exploring the sale of its Canadian unit. It could bring in as much as $10B (USD). (BBG)

  • L3Harris Technologies, an aerospace and defence company, has agreed to buy geostationary satellite company Viasta's Data Links Unit for $1.96B (USD). (BBG)

  • South Korean Internet giant Naver Corp has agreed to buy online secondhand marketplace Poshmark Inc in a deal worth ~$1.2B (USD). (BBG)

  • JPMorgan has been told it would need to pay $1B (USD) for full ownership of China International Funds Management, its Chinese mutual fund joint venture. (RT)

  • Link Group has received a $1B (AUD) non-binding bid for its corporate markets unit. The most obvious suitor is Dye and Durham. (AFR)

  • Mark Wahlberg-backed F45 Training Holdings, a fitness chain, has received a $385m (USD) take-private offer from existing shareholder Kennedy Lewis Investment Management. (RT)

  • Interfor, a Canadian lumber producer, has agreed to buy Chaleur Forest Products in a $236.4m (USD) deal. (RT)

  • AstraZeneca will pay a 660% premium for US-based gene therapy developer LogicBio Therapeutics, bringing the total cost to $68m (USD). (RT)

  • McGrath Estate Agents will buy a $7m (AUD) stake in its Central Coast franchisee. (AFR)

  • Asahi, a beer and software giant, has purchased StrangeLove, a premium low-calorie soft drink and mixers group. (AFR)

  • Hedge fund Engine Capital wants a merger between the two gaming companies, Light & Wonder and Sciplay. (BBG)

  • Wafra, a Kuwait-backed alternative asset manager, has purchased a minority stake in PE firm Oak Hill Capital. (BBG)

  • Bertelsmann, a German media giant, has decided not to sell its stake in French TV group M6. (BBG)

  • Vodafone has confirmed its potential merger with rival telecommunication company Three UK. (BBG)

  • Phoenix Sun's owner Robert Sarver is trying to sell the team. (BBG)

  • Polish refiner PKN Orlen expects its merger with Polish gas firm PGNiG to occur within weeks. (RT)

  • Greece has initiated the process of selling its stake in Volos port. (RT)

  • Sika, a selling admixture business, expects to complete a sale of its MBCC assets in the first half of next year. (RT)

  • Livingbridge PE, a PE firm, has lined up for Mercury Capital's marketing research services business FiftyFive5 ahead of its auction. (AFR)

  • Westland Milk, a subsidiary of China's Yili, has bought Waikato butter exporter Canary Foods. (Herald)

VC & Fundraising

  • Tally, a startup that automates credit card payments, has raised $80m (USD) at an $855m (USD) valuation. Sway Ventures led the round. (BBG)

  • Liquid Death, a water startup, has raised $70m (USD) at a $700m (USD) valuation. Science Ventures led the raise. (BBG)

  • Telehealth business InstantScripts which provides online medical prescriptions, is hunting for a new owner in a deal that could be worth ~$200m (AUD). (AFR)

  • Vehicle subscription business Splend has signed a $15m (AUD) funding package with MA Growth Ventures. (AFR)

  • Behemoth Brewing Company, a New Zealand independent brewery, is seeking to raise $3m (NZD) via the investment platform Snowball Effect. (NBR)

  • Early-stage VC firm Investible has backed Kite Magnetics and 7 other companies that are climate tech-focused. (AFR)

Equity Raises

  • Thai meet producer Betagro is planning to raise $462m (USD) in its Bangkok IPO. (BBG)

  • Japanese chip firm Socionext has priced at the top range of its IPO and raised $461m (USD). (BBG)

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