F&P Healthcare rises while energy stocks fall

New Zealand's main share index rose to a new record as a volatile Fisher & Paykel Healthcare bounced back from a three-month low amid record high covid cases in the United States.

Friday, December 11th 2020, 6:36PM

by BusinessDesk

The S&P/NZX 50 Index advanced 58.88 points, or 0.5 percent, to 12,919.25. Within the index, 31 stocks rose, 16 fell and three were unchanged. Turnover was $307.9 million.

F&P Healthcare led the market higher, climbing 4.5 percent to $33.23 although it has this week been trading at its lowest levels since September.

“Fisher & Paykel has been relatively volatile, and it can move on anything from a new outbreak of covid, to stimulus, to the currency,” said Jeremy Sullivan, investment adviser at Hamilton Hindin Green.

The broader market also enjoyed an end of week rally, with investors rebalancing their portfolios ahead of the Christmas break.

Tourism Holdings rose 3.2 percent to $2.60, Oceania Healthcare was up 3 percent at $1.36, and Precinct Properties gained 2.9 percent at $1.75.

“You normally get a bit of a rosy feeling heading into Christmas as people start to think about their holidays, but I do think there are some headwinds coming our way,” Sullivan said.

Electricity stocks fell having run up to all time highs, limiting the index’s headline gain.

Meridian Energy was the day’s weakest performer, falling 4 percent to $6.61 as investors cashed in some profits while it was sitting at a record.

Mercury NZ dropped 2.4 percent to $6.59, Contact Energy declined 1.1 percent to $7.93 and Vector was down 0.5 percent at $4.21.

Genesis Energy, which was largely excluded from the recent rally on account of its use of fossil fuels, climbed 2.6 percent to $3.55. On Wednesday, the electricity firm announced its plans to cut its greenhouse gas emissions to target 1.5 degrees of global warming.

Infratil and Pacific Edge both rallied more than 20 percent this week, the first due to a takeover offer and the other on a broker upgrade.

The infrastructure investment firm continued to climb, rising half a percent to $7.22, while Pacific Edge fell 1 percent to 98 cents.

Trustpower, an asset controlled by Infratil, held at $8.05 after climbing 8.5 percent across the week.

Chorus was up 0.8 percent at $7.94 today, but is the index’s worst performing stock in the past month having fallen more than 12 percent.

Australia & New Zealand Banking Group has climbed 11.3 percent over the past month, at $24.45, opening up its lead on rival Westpac Banking Corp which has gained 6.9 percent during the period, at $21.28.

In currency markets, the kiwi dollar resumed its rally after a pause yesterday. The kiwi broke through 71 US cents, and was at 71.01 cents at 5pm in Wellington, up from 70.36 cents yesterday.

The kiwi also climbed against the British pound after an overnight meeting between UK Prime Minister Boris Johnson and the European Commission president Ursula von der Leyen failed to result in a trade deal breakthrough.

The pound moved lower as some traders lost confidence a European Union trade deal would get across the line, despite it being in the best interest of both economies.

The kiwi was trading at 53.31 British pence at 5pm, up from 52.62 pence yesterday.

What financial market participants may see as an obvious solution to an economic problem, some British voters might see as a betrayal of the nation. Johnson is beholden to those voters and not to currency traders.

The deadline to avoid a ‘no-deal Brexit’ was extended to Sunday, meaning the impasse could result in a sharp reaction when the markets reopen on Monday morning.

The trade-weighted index was at 74.10 at 5pm, from 73.70 yesterday. The kiwi traded at 93.93 Australian cents from 94.15 cents, 73.89 yen from 73.47 yen, 58.40 euro cents from 58.17 cents, and 4.6428 Chinese yuan from 4.6035 yuan.

Tags: Market Close