The New Zealand dollar drops on dovish RBNZ statements

US equity markets

US equity markets ended Tuesday’s session little changed. It was a similar picture overnight in the APAC region. The Hang Seng underperformed as Hong Kong's economy, which expanded 2.3% in 2023, is expected to grow 2.5%–3.5%. Its Financial Secretary also announced measures to support the economy, particularly its property market.

Reserve Bank of New Zealand

In New Zealand, the Reserve Bank of New Zealand (RBNZ) maintained its official cash rate at 5.5%. The decision was in line with all but one economist polled by Reuters. In its statement, the RBNZ reiterated that it needs to keep policy restrictive for a while in order to bring inflation below its 1% to 3% target band. However, the central bank took the market by surprise with a more dovish outlook than some had anticipated, sending the Kiwi dollar down. It now considers that the risks to the inflation outlook have become more balanced.

Australian consumer price index

In Australia, consumer price inflation held at a two-year low in January. The monthly consumer price index rose at an annual pace of 3.4% in January, unchanged from December and under market forecasts of 3.6%. This latest data reinforces the market opinion that interest rates do not need to increase any further.

Eurozone economic sentiment

In Europe, very little is expected on the macroeconomic front. At 10 a.m., Eurozone economic sentiment is expected to marginally rise to 96.7 in February from 96.2 the previous month. The currency market is more likely to move this afternoon with the release of the latest US growth figures. This is a second estimate of gross domestic product (GDP) in Q4. Economists forecast the economy to have expanded 3.3% in the October–December quarter. At 3 p.m., wholesale inventories are expected to rise by 0.2% in January month-over-month (MoM).

Reckitt Benckiser

Reckitt Benckiser's revenue dropped by 2.4% in Q4, missing expectations. The group attributed the decline to the performance of seasonal products such as colds and flu. For the full year, revenue rose 3.5%, operating profit fell 1.9%, and adjusted operating margin dropped 70 basis points to 23.1%.

Taylor Wimpey

Taylor Wimpey posted a 20.5% drop in revenue to £3.51 billion. Operating profit fell 49.1%. The group said it welcomed the CMA's report on improving the planning system, adoption of amenities, and outcomes for house buyers.

Halfords Group

Halfords Group warns of a significant drop in like-for-like revenue growth in its retail business. As a result, it now expects pretax profit to fall in the range of £35–40 million, down from £48–53 million.

Aston Martin

Aston Martin Lagonda posted a smaller than expected loss for 2024. Revenue increased 18, adjusted EBITDA rose by 61%, and loss before tax was reduced to £239.8 million from nearly half a billion the previous year.

Currys

Currys set a new one-year high yesterday after it said it rejected a new £757 million bid from Elliott Advisors. Elliott's second approach came in at 67 pence, compared to its initial 62 pence bid, but Currys said that was not enough. China-based online giant JD.com has said it is also considering an offer for Currys but has yet to show its cards. Britain's takeover regulator has set March 16 as a deadline for the bidders to make a firm offer for Currys or walk away.

Just Eat Takeaway.com

Just Eat Takeaway.com posted an adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) of €324 million for 2023, compared to €19 million the previous year. Revenue fell by 7% to €5.17 billion. For 2024, Just Eat forecasts a nearly 40% jump in its 2024 core earnings, ahead of expectations.

eBay

eBay shares jumped as much as 10% in extended trading before ending the session on the IG platform, up 4.2%, on the back of better-than-anticipated earnings and revenue in the fourth quarter. The e-commerce platform benefited from healthy consumer spending during the holiday season. It reported an adjusted profit per share of $1.07, compared with an estimate of $1.03 per share. Revenue reached $2.56 billion, beating analysts' average estimate of $2.51 billion. Gross merchandise volume rose 2% to $18.59 billion in the fourth quarter, up from $18.23 billion a year ago. Analysts anticipated a decline. The business was particularly supported by its US customers. But eBay flagged weakness in the UK and Germany.

The US. Salesforce

A couple of familiar stocks are due to report today in the US. Salesforce is forecast to post earnings of $2.27 per share on revenue of $9.22 billion. And Snowflake: Q4 earnings per share (EPS) is seen at 18 cents and revenue at $761 million.

Crude oil

On Tuesday evening, the Application Programming Interface (API) said crude oil stock rose by 8.4 million barrels last week. Both gasoline and distillate stockpiles fell by 3.3 million and 500,000 barrels, respectively. This had little impact on the oil price, which prior to that new news rose by about 2%. Yesterday afternoon, three OPEC+ sources told reporters the organisation will consider extending voluntary oil output cuts into the second quarter to provide additional support for the market. Last November, the OPEC+ agreed to voluntary cuts totaling about 2.2 million barrels per day for the first quarter of this year.