NZ shares fall from record

The New Zealand share market started the last full trading week of a tumultuous year on a weaker note as Fisher & Paykel Healthcare pulled it down from a record high.

Monday, December 14th 2020, 6:31PM

by BusinessDesk

The S&P/NZX 50 Index fell 84.13 points, or 0.7 percent, to 12,835.12. Within the index, 25 stocks fell, 18 rose and seven were unchanged. Turnover was $146.5 million.

The NZ share market rose to a new record on Friday, but the softer sentiment offshore caught up with the local bourse when it opened an hour an half late, due to a technical failure in the NZX’s internal systems.

F&P Healthcare, which lifted from a three-month low on Friday, fell back 3.5 percent to $32.07. A move that size is not uncommon in the currently volatile stock, it been trading in a range between $31.50 and $37 since April.

“There is a tug of war between those that think Fisher & Paykel’s earnings are going to remain elevated post-covid, and those that believe their earnings will be impacted once covid dissipates,” said Peter McIntyre, an investment adviser at Craigs Investment Partners.

Mercury NZ fell 5.2 percent to $6.25, while Contact Energy posted the biggest gain as it jumped 4.5 percent to $8.29. It has been driven higher by continued interest in green investments from large fund management firms.

“You’ve seen some exchange traded fund buying into stocks that exhibit renewable energy and Contact is one of those,” McIntyre said. “You are seeing global funds that screen for those attributes pick up Meridian and Contact.”

For example, BlackRock Asset Management holds an 11 percent stake, while Vanguard Group holds just under 5 percent.

Freightways hit an intraday record and closed at $10 after climbing 1.4 percent. McIntyre said the stock is likely to benefit from increased ecommerce package delivery during the festive season.

Pacific Edge, which climbed more than 25 percent last week, added another 4.1 percent gain as it broke the one-dollar barrier and closed at $1.02. It has been rallying ever since Jarden Research gave it a target price of $1.40.

Infratil declined half a percent to $7.18 after lifting 25 percent last week when AustraliaSuper targeted the infrastructure investor with a takeover bid.

Heartland Group Holdings revealed a piece of research showing 90 percent of senior Australians want to remain in their home for as long as possible, but struggle to fund it.

The reverse lender said, “experts believe reverse mortgages could be the solution” and its share price climbed 1.9 percent to $1.63.

The NZ dollar hit a new post-2018 high on Friday before retreating to a still-elevated level. It was trading at 70.93 US cents at 5pm in Wellington, down from 71.01 cents on Friday.

US lawmakers are still debating a new stimulus package, and with the previous one set to expire in a matter of weeks, some traders sought haven currencies which pulled the kiwi lower.

The trade-weighted index was at 74.07 at 5pm, from 74.10 on Friday. The kiwi traded at 94.08 Australian cents from 93.93 cents, 73.76 yen from 73.89 yen, 58.46 euro cents from 58.40 cents, 53.21 British pence from 53.31 pence, and 4.6381 Chinese yuan from 4.6428 yuan.

Tags: Market Close