NZ shares gain 2.5% this week

New Zealand's main share index finished the week up 2.5% buoyed by strong earnings results from Fisher & Paykel Healthcare and a dovish speech from the US Federal Reserve.

Friday, December 2nd 2022, 5:56PM

by BusinessDesk

The S&P/NZX 50 Index fell 12.7 points, or 0.1%, to 11,641.85 today. Turnover was $133.2 million.

Stride Property Group led the decline with a 2% fall to $1.45, bringing its loss this week to 5.8%.

Newly listed technology stock Blackpearl dropped 13.6% to $1.08 in its first trades, 15,700 shares changed hands and the company ended the day with a market value of $37.5m.

The Australian banks, ANZ and Westpac, each fell 2% to $26.36 and $25.22, respectively.

But today’s modest decline came after a strong week, in which some local companies reported strong earnings and the S&P 500 jumped following a US Fed speech.

Chair Jerome Powell gave remarks that market traders interpreted as being less aggressive on rate hikes than he had been previously.

BNZ strategist Jason Wong said the speech wasn’t all that different from his others but he did note the October inflation data was a “welcome surprise”.

“He cemented in market expectations for a dialled-down hike of 50bps this month but reiterated that rates will need to be restrictive for some time,” Wong said in a note.

The positive US news helped to lock in local share market gains which had been driven by stock-specific news earlier in the week.

F&P Healthcare, one of the largest stocks on the index, gained more than 16% in the past week after it told investors that sales appear to have returned to normal.

The healthcare stock fell 1.1% to $24.05 today but has held onto most of its gains since it reported its half-year result on Wednesday.

Gentrack, another standout success this week, gained another 1.2% to $2.48 – bringing its gain in the past week above 45%.

The energy software company impressed investors with a 19% lift in annual revenue and added $20m to its 2024 guidance.

Shares in Synlait Milk were up 0.6% at $3.18 today, and have climbed more than 10% this week, as it bounced back from a steady decline throughout November.

Retirement stocks made big gains this week as they recovered from brutal selloffs following the Reserve Bank’s monetary policy statement which warned of higher interest rates and a looming recession.

Over this past week, Summerset rose 9.7% to $9.60, Arvida gained 8.7% to $2.44, and Oceania was up 6.4% at 84 cents.

Scales jumped 6.2% to $4.62 this week after the US dollar gave up some of its Herculean strength after the dovish US Federal Reserve chair speech.

The kiwi dollar was trading at 63.58 US cents at 3pm in Wellington, up from 63.21 cents yesterday, and up 2.4% in the past five days. The currency has risen 15% from its low point in September.

“The market evidently saw Powell as not as hawkish as feared, fuelling higher risk sentiment which sent the US dollar broadly lower,” BNZ’s Jason Wong said.

“We thought it was overdue for some consolidation, but momentum has remained strong”.

Other key currency crosses have seen similar but smaller movements. The NZ dollar was up 6.3% against the Japanese yen and 7% against the Australian dollar.

The trade-weighted index was at 73.25, from 71.84 10 days ago.

Tags: Market Close