Jeremy Hutton: Milford Asset Management Equities Analyst on the market response to Trump returning to the White House

Donald Trump officially got the keys back to the White House earlier this week - and his return to power could have an impact on NZX-listed businesses.

Fisher & Paykel Healthcare produces medical devices sold in the US, and it's likely the incoming tariffs could leave an impact.

Milford Asset Management's Jeremy Hutton explains further.

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Episode Transcript

Speaker 1 (00:00):
We've got to look at the markets right now we

(00:01):
go Jeremy Hatton from milfind Acid Management with US. Hello, Jeremy, Hi,
Andrew Trump is back. The S and P was strangely
unmoved over. They must have factored it in. What about
inz X.

Speaker 2 (00:14):
Yeah, Trump is back and there are a whole bunch
of potential impacts on INZX listed companies and the New
Zealand economy as a whole. I'll start with Fisher and
Pikell Healthcare. So they're our largest listed company and they're
exposed through two different limbs. So firstly, around fifty percent
of their medical devices are sold in the US, so

(00:36):
perhaps there will be some impact here on demand if
tariffs are put in place. But also Fisher and Pikel
has a substantial manufacturing base in Mexico. Around sixty percent
of their manufacturing product is based there, and Mexico does
seem to be in Trump's sites a lot more. Now,
Fisher and Pikel does have manufacturing in New Zealand as well,

(00:57):
and of course that can be sent across to the U,
but that does depend a little bit on the cost
and the tariff differential between US and Mexico. But perhaps
at the very least you could see an increase in
freight cost for Fisher and Pycal Healthcare and perhaps a
small profit hit as well.

Speaker 1 (01:15):
Okay, so no immediate impact, but watch the space it
could be coming. What about renewable energy and wind? Could
that be impacted?

Speaker 2 (01:23):
Yeah? Trump does have renewable energy and the subsidies for
those in the sites in particular so Biden's Inflation and
Reduction Act. There had been a huge boom of onshore
and offshore wind developments and also some solar projects too
in the US. And we have a business also listed
on the INSIDEX Infratil and they have a portfolio company

(01:44):
called Long Road Energy and they are a large developer
of renewable energy in the US. So Long Road is
about fourteen percent of Infantool's value. So it will be
impactful and has been talked about in the market as
having a bit of Trump risk, But there are a
few comments encountered to this risk. Most of Long Road's

(02:05):
development pipeline is solar in batteries. Only six percent of
the pipeline is wind, and Trump does seem a lot
more fixated on wind and the killing of the birds.
From this wind and then finally a lot more sorry,
and a lot of these long road solo projects are
in red states, mainly Texas and Arizona, and he might

(02:26):
get some pushback from fellow Republicans, particularly if it starts
to impact jobs in these states.

Speaker 1 (02:32):
Pretty good stuff, Jeremy Haddon from Helfred AC Management, I
thank you so much for your time today. For more
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