NZ shares turn over just $83m as market settles down for Christmas

The jolly Christmas rally investors were hoping for as the big day creeps closer didn't arrive, but on the last full day of trading before Christmas, New Zealand’s market had a small bounce in its step.

Thursday, December 22nd 2022, 10:12PM

by BusinessDesk

Today the S&P/NZX 50 index rose 79.1 points or 0.63%, to 11,523.96. Turnover was a very light $83.2 million.

Hamilton Hindin Greene’s Grant Davies said NZ’s market had followed US markets’ positive lead – but a Christmas rally was no longer on the cards.

From the new year, markets would be watching corporate results a little more closely, rather than focusing so much on the macro environment and big picture, he said.

“The story of this year, really, has been that corporate results have been pretty reasonable, but inflation and interest rates have been enough to dampen them,” he told BusinessDesk.

Synlait Milk was the big news on the index today and was down 2.2% to $3.49 after sharply reduced sales volumes led the dairy processing company to warn the market that first-half profit would be weaker after problems with implementing SAP IT systems.

Computer problems – which delayed shipments of the firm's ingredient products in the first four months of the July 2023 financial year – meant that sales fell by about 45% in those 16 weeks.

The company also said milk supplies were lower over the same period.

A2 Milk was up 1.8% to $7.23, and Fonterra Shareholders’ Fund units also rose 1.9% to $3.30.

Global cinema software provider Vista Group was up 4.2% to $1.49 after announcing it had a new agreement with existing customer Cineplex that will see it transition to Vista’s cloud platform.

The five-year agreement will see the Canadian company move its 170 movie theatres and entertainment venues onto Vista Digital by November 2023 – and Vista Cloud through 2025.

Vista Group chief executive Kimbal Riley said the deal built on the company’s nearly 20-year partnership.

Cancer diagnostics company Pacific Edge jumped 5.3% to 50 cents, while healthcare manufacturer Fisher & Paykel Healthcare rose 1.1% to $22.05.

It’s been a big news week for medicinal company Cannasouth, which announced on Monday that it was going to pay $48.8m for Equalis Pharmaceuticals in an all-scrip deal.

The company was up 5.3% to 30 cents after it told the market today that it had signed a sale and purchase agreement (SPA) for the assets of its manufacturing subsidiary, Midwest Pharmaceutics to Harker Herbals for $2.2m – plus stock at valuation.

Cannasouth said the divestment of the Midwest liquid filling assets to Harker Herbals would reduce the need for the company to invest further Capex into Midwest to have it good manufacturing process-ready (GMP-ready) for cannabinoid medicines.

Alongside this news, Cannasouth also appointed Pierre Booysen as the group’s new chief compliance officer today.

Booysen, who is a pharmacist by profession and has worked extensively in the medicinal cannabis industry, will start his new role in early February.

Rua Bioscience shares were flat at 22 cents per share and Greenfern Industries rose 4.6% to 9.1 cents.

Retirement village operator Ryman Healthcare edged down 1.2% to $5.63 and turned over $3.5m in value today. General insurer Tower also fell 2.8% to 70 cents.

Fletcher Building was down by 0.4% to $4.78 today. In a note yesterday. Jarden analyst Grant Swanepoel summed up the investment community’s reaction to the news Fletcher Building had to add another $150 million to its high-rise provisions as “a lump of coal for Xmas”.

Swanepoel said it drove home an expectation that investors had seen the last of the vertical construction downgrades, when there was “yet another one” and lopped 10 cents off his per-share discounted cashflow valuation.

Today, the NZ dollar was trading at 62.96 US cents at 3pm in Wellington, down from 63.37 US cents yesterday.

The kiwi dollar was last around the 62-cent mark at the end of November and currency trader OFX said in a note today the kiwi had edged down from some “modest” strengthening of the US dollar.

Tags: Market Close