The US sharemarket took a hit last Friday, largely due to weakness in the information technology sector.
The semiconductor sector was hit hard, and experts are unpacking the economic implications.
Harbour Asset Management's Shane Solly explained further.
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Speaker 1 (00:00):
All right, we're joining now by Shane Sally who's from
Harbor Asset Management. Welcome in, Shane.
Speaker 2 (00:06):
Yeah, Hey, Andrew.
Speaker 1 (00:06):
The USAir market down on Friday. That was because of
a weakness in the information technology sector, particularly the semiconductors.
So what's happening with semi conductors.
Speaker 3 (00:16):
Yeah, what's called the Philadelphia Philadelphia Semiconductor Index. That's note
as the socks fell more than ten percent on Friday.
A couple of key reasons behind Andrew. Firstly, we saw
a stronger US non farm labor so basically more people
were employed. That's given markets concerned about the US for
the Reserve removing the risks, so they're not living to
(00:36):
do rate cuts, and people were saying they're wried about
them their rate increases that push bondyards up, so not
good for valuations.
Speaker 2 (00:43):
Secondly, Broadcom, one of the big.
Speaker 3 (00:45):
Semiconductor companies on Thursday, get a pretty flat revenue outlock.
Speaker 2 (00:48):
Market didn't like that, wanted more.
Speaker 3 (00:50):
Third there's definitely a case where investors maybe taking profits
to use money to invest in some of these exciting
new companies are listing on the market. Conductor is pretty
crowded trade. Also, it's a very cyclical sector. It is
sensitive to new supply and there's some new large fabrications
coming on. So one of the things we're watching for,
(01:11):
Andrew is the rest of the market. The non tech
sector was pretty solid hold up per case, so it
does seem to be a tech semiconductor issue. Not crying
too much so that semiconductor and Dixon the US up
seventy percent year that even with Friday's ten percent four.
Speaker 1 (01:26):
Meanwhile, it's all about the war, and the war keeps
on sputtering on Iran as rail trading, missile strikes today,
So what does that do to the markets?
Speaker 3 (01:36):
Yeah, I think we've just seen this re escalation of
Middle East tension. Did see the oil price Gupe, As
you mentioned the Brent oil price currently trading at ninety
seven forty US It would have been high, but we're
actually seeing Chinese buyers really pull backs anyway, So they're
actually helping the rest of the world by not buying
at the moment, but nonetheless that higher for longer energy
(01:56):
impact that sees people worried about inflation.
Speaker 2 (01:59):
A lot of growth contribute to a bit of a
risk off tone.
Speaker 3 (02:02):
Really, we've seen it in the Asian markets today. The
Korean market down eight.
Speaker 2 (02:08):
Point two percent as we speak, and the Japanese market
down four point two percent as we speak, so pretty weak.
Speaker 1 (02:14):
What about local investment markets?
Speaker 3 (02:16):
Yeah, look, I think what we saw here was a
bit of a pop up in our bond years a
tenure gament bond yos.
Speaker 2 (02:21):
That's important. It's a hurdle which it's the benchmark for
low risk.
Speaker 3 (02:24):
So tener gamment bond yo is up to zero point
seven we sent back to four point six percent.
Speaker 2 (02:28):
You know, on dollar a little bit weaker.
Speaker 3 (02:29):
He's on shre market down as you're saying, led by Orcanny,
Important Fort Till Meridi and some of the big caps.
Speaker 2 (02:34):
But very light volume today, so not a big data volume.
We're watching the US shear market futures to see whether
they sell off from Friday continues, some very anxious investors
at this stage. Pretty flat, so as people watching closely.
Speaker 1 (02:50):
All right, what else are you watching out for this week?
Speaker 2 (02:53):
Yeah? Look, we're watching locally.
Speaker 3 (02:55):
We're seeing a bit a few data pieces that really
might help us in terms of understanding how weak.
Speaker 2 (03:00):
Things have gotten the last three months.
Speaker 3 (03:01):
Tomorrow we've got the New Zealand Manitacture Index out for
the first quarter, and then Friday we've got the Business
new zeon Manuitacturing and Performance Index for May and net
migration for April, so again a litmus test where now
it's been very shoppy.
Speaker 2 (03:14):
These will give us a bit more confirmation.
Speaker 3 (03:16):
Chinese data out Tuesdays and export data and inflation data on Wednesday,
again important for US as an exporter into into China,
and then the US consumer price inflation out Thursday and
US production price inflation on Friday. They're important because it
comes back to this, how far does the feed? How
fast is if you'd have to change rates to bond
markets there and control?
Speaker 1 (03:37):
And very important because the data will cover actually war periods,
So that's something we really want to know. And I
thank you so much. Shane Solely from Harbor Asset Management.
Thank you for more from hither Duplessy Allen Drive.
Speaker 3 (03:48):
Listen live to news talks. They'd be from four pm weekdays,
or follow the podcast on iHeartRadio
All right, we're joining now by Shane Sally who's from
Harbor Asset Management. Welcome in, Shane.
Speaker 2 (00:06):
Yeah, Hey, Andrew.
Speaker 1 (00:06):
The USAir market down on Friday. That was because of
a weakness in the information technology sector, particularly the semiconductors.
So what's happening with semi conductors.
Speaker 3 (00:16):
Yeah, what's called the Philadelphia Philadelphia Semiconductor Index. That's note
as the socks fell more than ten percent on Friday.
A couple of key reasons behind Andrew. Firstly, we saw
a stronger US non farm labor so basically more people
were employed. That's given markets concerned about the US for
the Reserve removing the risks, so they're not living to
(00:36):
do rate cuts, and people were saying they're wried about
them their rate increases that push bondyards up, so not
good for valuations.
Speaker 2 (00:43):
Secondly, Broadcom, one of the big.
Speaker 3 (00:45):
Semiconductor companies on Thursday, get a pretty flat revenue outlock.
Speaker 2 (00:48):
Market didn't like that, wanted more.
Speaker 3 (00:50):
Third there's definitely a case where investors maybe taking profits
to use money to invest in some of these exciting
new companies are listing on the market. Conductor is pretty
crowded trade. Also, it's a very cyclical sector. It is
sensitive to new supply and there's some new large fabrications
coming on. So one of the things we're watching for,
(01:11):
Andrew is the rest of the market. The non tech
sector was pretty solid hold up per case, so it
does seem to be a tech semiconductor issue. Not crying
too much so that semiconductor and Dixon the US up
seventy percent year that even with Friday's ten percent four.
Speaker 1 (01:26):
Meanwhile, it's all about the war, and the war keeps
on sputtering on Iran as rail trading, missile strikes today,
So what does that do to the markets?
Speaker 3 (01:36):
Yeah, I think we've just seen this re escalation of
Middle East tension. Did see the oil price Gupe, As
you mentioned the Brent oil price currently trading at ninety
seven forty US It would have been high, but we're
actually seeing Chinese buyers really pull backs anyway, So they're
actually helping the rest of the world by not buying
at the moment, but nonetheless that higher for longer energy
(01:56):
impact that sees people worried about inflation.
Speaker 2 (01:59):
A lot of growth contribute to a bit of a
risk off tone.
Speaker 3 (02:02):
Really, we've seen it in the Asian markets today. The
Korean market down eight.
Speaker 2 (02:08):
Point two percent as we speak, and the Japanese market
down four point two percent as we speak, so pretty weak.
Speaker 1 (02:14):
What about local investment markets?
Speaker 3 (02:16):
Yeah, look, I think what we saw here was a
bit of a pop up in our bond years a
tenure gament bond yos.
Speaker 2 (02:21):
That's important. It's a hurdle which it's the benchmark for
low risk.
Speaker 3 (02:24):
So tener gamment bond yo is up to zero point
seven we sent back to four point six percent.
Speaker 2 (02:28):
You know, on dollar a little bit weaker.
Speaker 3 (02:29):
He's on shre market down as you're saying, led by Orcanny,
Important Fort Till Meridi and some of the big caps.
Speaker 2 (02:34):
But very light volume today, so not a big data volume.
We're watching the US shear market futures to see whether
they sell off from Friday continues, some very anxious investors
at this stage. Pretty flat, so as people watching closely.
Speaker 1 (02:50):
All right, what else are you watching out for this week?
Speaker 2 (02:53):
Yeah? Look, we're watching locally.
Speaker 3 (02:55):
We're seeing a bit a few data pieces that really
might help us in terms of understanding how weak.
Speaker 2 (03:00):
Things have gotten the last three months.
Speaker 3 (03:01):
Tomorrow we've got the New Zealand Manitacture Index out for
the first quarter, and then Friday we've got the Business
new zeon Manuitacturing and Performance Index for May and net
migration for April, so again a litmus test where now
it's been very shoppy.
Speaker 2 (03:14):
These will give us a bit more confirmation.
Speaker 3 (03:16):
Chinese data out Tuesdays and export data and inflation data on Wednesday,
again important for US as an exporter into into China,
and then the US consumer price inflation out Thursday and
US production price inflation on Friday. They're important because it
comes back to this, how far does the feed? How
fast is if you'd have to change rates to bond
markets there and control?
Speaker 1 (03:37):
And very important because the data will cover actually war periods,
So that's something we really want to know. And I
thank you so much. Shane Solely from Harbor Asset Management.
Thank you for more from hither Duplessy Allen Drive.
Speaker 3 (03:48):
Listen live to news talks. They'd be from four pm weekdays,
or follow the podcast on iHeartRadio
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