Yovich & Co Market Update - 11 May 2026.

The NZX 50 rose 1.03%, a second consecutive weekly gain, with Infratil noted as a key contributor after positive results from their Canberra Data Centre operation. The OECD expects New Zealand’s economy to recover gradually, with growth forecast to lift to 1.4% in 2026 and 2.3% in 2027, supported by lower interest rates, tourism, and exports. However, the recovery is expected to remain fragile, with elevated unemployment, subdued migration, higher energy and transport costs, and global uncertainty continuing to weigh on household incomes, confidence, and domestic demand.

The All Ordinaries rose 0.29% over the week, despite a weaker finish on Friday, with the index falling 1.39% to 8,980.50. During the week, the Reserve Bank of Australia increased the cash rate target by 25 basis points to 4.35%, while annual CPI inflation for March 2026 was reported at 4.6%. This kept interest-rate sensitivity front of mind for Australian equities, particularly across the banking and consumer-related sectors. Markets are now pricing in the potential for further rate hikes over the year ahead, with expectations that the cash rate could reach 4.75% by year-end.

The Shanghai Composite increased by 1.62% for the week to 4,179.95, although there are concerns due to renewed hostilities between the US and Iran.

The FTSE 100 fell 1.28% over the week, closing at 10,233.07, its third straight weekly decline. UK equities were weighed down by renewed concerns over the US-Iran ceasefire, rising oil-related uncertainty, and political developments following UK local election results.

US markets were the standout performer, led by the NASDAQ, which rose 4.51% over the week, while the Dow Jones gained 0.22%. The Nasdaq was buoyed by AI-related stocks, strong corporate earnings momentum, and a stronger-than-expected US jobs report. Reuters noted that US employment increased more than expected in April, unemployment held at 4.3%, and markets continued to price in the Federal Reserve holding rates steady in the 3.50% to 3.75% range for the time being.

Investment News   

Rocket Lab (RKLB) — record quarter, bigger guide, and a backlog that keeps building
Rocket Lab delivered one of the standout growth updates of the week, posting record Q1 2026 revenue of $200.3m (63.5% YoY) and GAAP gross margin of 38.2%, while highlighting a $2.2bn backlog and greater than $2bn of total liquidity to support its growth pipeline. The forward-looking signal was the step-up in activity implied by guidance: Management guided Q2 revenue of $225m to $240m, suggesting momentum in Space Systems is translating into near-term delivery (not just headline contracts). Share Price Reaction: The market response was decisive, with coverage pointing to an approximately 30% intraday jump following the release. Bull case: backlog converts cleanly into revenue and margins hold up as scale increases. Bear case: Execution slippage (launch cadence / deliveries) delays revenue conversion and cools sentiment.
Current Share Price: $105.47, Consensus Target Price: $91.51.

Palantir (PLTR) blowout growth, raised outlook, but valuation nerves reappeared
Palantir reported its fastest revenue growth as a public company, with Q1 revenue of $1.63bn (85% YoY) and adjusted EPS of $0.33, underscoring how strongly “AI-led” spending is flowing through its platform. The forward-looking message was even more bullish: Management lifted FY26 revenue expectations to about $7.65bn to $7.66bn (widely described as roughly circa 71% YoY growth) and highlighted very strong U.S. momentum. Share Price Reaction: Despite the beat-and-raise, the stock reaction was mixed as investors revisited valuation, reducing price by 5.9% in the following session. Bull case: Raised guidance proves conservative and U.S. commercial demand continues to accelerate. Bear case: Growth stays strong but the market de-rates the stock if expectations/valuation get too stretched.
Current Share Price: $137.80, Consensus Target Price: $1484.58.

AMD (AMD) — AI/data-centre strength drove a beat and a punchy Q2 margin outlook
AMD reported Q1 revenue of $10.3bn and non-GAAP EPS of $1.37, with management pointing to strong data-centre momentum as the key driver. What investors focused on was the outlook: AMD guided Q2 revenue of circa $11.2bn ± $0.3bn and approximately 56% non-GAAP gross margin, signalling a mix shift toward higher-value data-centre products. Share Price Reaction: Coverage noted AMD shares jumped more than 7% after-hours on the result and guidance. Bull case: Data-centre demand (AI servers) keeps compounding, and margin expansion continues. Bear case: PC/consumer demand softens or AI competition pressures pricing, limiting margin upside.
Current Share Price: $455.19, Consensus Target Price: $415.31.

Infratil (IFT.nz) — CDC lands Australia’s biggest-ever data centre contract
Infratil’s data-centre business CDC announced it has secured a 555MW, 30-year contract with a US high-end investment-grade customer, taking CDC’s total contracted capacity to over 1GW. The capacity will come online across campuses already under development and is expected to become operational over FY28–FY29. CDC said this deal implies EBITDAF is expected to exceed A$1bn in FY28, and that when fully deployed, CDC’s contracted capacity could support  circa A$2bn of annualised EBITDAF; importantly, CDC said the contract sits within its current growth plan and does not require further shareholder equity, with funding expected from existing cash, committed facilities and additional debt/hybrid funding. Share Price Reaction: Media coverage described IFT shares surging about 12% on the announcement (one of the biggest daily moves in years). Bull case: This becomes a “proof point” that pulls in more hyperscale contracts, accelerating earnings into FY28–FY29. Bear case: Build/timing risk (capex, delivery schedule, financing costs) becomes the market’s focus if the construction ramp runs hot.
Current Share Price: $15.04, Consensus Target Price: $14.96. Forecasted Dividend Yield: $1.37%.

NZ bellwethers (not earnings, but still worth watching)

Auckland Airport (AIA.nz) remains a clean read on travel demand; its latest monthly update showed circa 928k international passenger movements (8% YoY) and international load factors of 86% (up 4.4pp) a supportive mix for yields if demand stays ahead of capacity. Bull case: Sustained international demand supports higher aeronautical and retail revenues. Bear case: Capacity or demand normalises quickly (or geopolitical shocks hit travel), softening momentum.
Current Share Price: $8.35, Consensus Target Price: $8.70. Forecasted Dividend Yield: $1.61%.

Fisher & Paykel Healthcare (FPH.nz) hasn’t reported yet, but it has confirmed its full-year result date (26 May 2026) making it a near-term catalyst as investors position for FY27 margin and demand commentary. Bull case: Hospital demand trends and guidance surprise to the upside. Bear case: margins remain under pressure and guidance disappoints a market with high expectations.
Current Share Price: $35.50, Consensus Target Price: $41.59, Forecasted Dividend Yield: $1.37%.

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