Markets unmoved by record inflation

New Zealand's main share index was largely unchanged on Thursday as a market rally was immediately halted by investors either taking the chance to sell or being spooked by a weak Netflix result.

Thursday, April 21st 2022, 6:57PM

by BusinessDesk

The S&P/NZX 50 Index rose just 12 points, or 0.1%, to 11,954. Turnover was $137 million.

Two large US companies reported opposite results overnight, Netflix plunged after losing subscribers in the first quarter while Tesla jumped after beating revenue expectations by US$1 billion (NZ$1.47b).

The S&P 500 was also more or less flat last night, while US bond yields eased.

Jeffrey Halley, a senior market analyst at Oanda, said Asian markets were likely to take “a wait-and-see approach” and watch what US investors do in the coming sessions.

NZ inflation data released today showed consumer prices were up 6.9% year on year in the March quarter. This is a 30-year high but lower than economists had predicted.

The share market was fairly unmoved by the inflation rate, but the kiwi dollar fell from 68.07 US cents to 67.69 cents.

“The New Zealand dollar is 0.4% lower today as the markets price the ever-deeper hole the Reserve Bank of New Zealand has dug itself, and the shrinking options it has to extricate itself,” Halley said.

Air NZ rights had the biggest gain on the local share market, up 8.7% at 64 cents each. Ordinary shares were also up 0.6% at 85.5c, meaning the rights were just half a cent cheaper.

Rights trading closes on Tuesday, April 26 and rights have to be exercised by Sunday, May 1.

Some heavily sold growth stocks saw some recovery today: Plexure rose 5.5% to 29c, Vista Group was up 4.1% at $1.78, and Pacific Edge climbed 2.2% to 94c.

Steel & Tube Holdings rose 4.1% to $1.52 and Vulcan Steel was up 2.8% at $10.10.

Media company NZME had the biggest fall, tumbling 8.2% to $1.45, after a strong few months of upward momentum.

Some property stocks also performed well, perhaps encouraged by the prospect of interest rates not needing to climb any more than forecast.

Arvida Group rose 2.4% to $1.70, Investore Property was up 2.4% at $1.74, Goodman Property gained 1.7% at $2.34, and Stride Property climbed 2.1% to $1.94.

Tags: Market Close