NZ shares flat ahead of Reserve Bank rate decision

The New Zealand sharemarket lacked direction ahead of the Reserve Bank’s latest monetary review while shares bounced back offshore.

Tuesday, July 11th 2023, 6:30PM

by BusinessDesk

With a rebound on Wall Street, the S&P/NZX 50 Index had an early morning rise but soon went downwards until it was pulled back in a late surge.

The index closed flat at 11,909.81, down 2.92 points or 0.02%, after hitting an intraday low of 11,859.93 points and high of 11,926.7.

There were 74 gainers and 50 decliners over the whole market, on volumes of 33.18 million share transactions worth $133.92m.

Matt Goodson, managing director of Salt Funds Management, said “the local market showed real resilience last week but today was the opposite – Aussie was up more than 1% and we were down.

“I sense the flows into our market over the last few days – the buying had been relentless – has reached the end of being invested and a few names are drifting,” he said.

The Reserve Bank is expected to hold the official cash rate (OCR) at 5.5%, and Goodson said the wisest call for the bank ahead of the general election is to make a brief neutral statement on its current expectation and sit back.

In the United States, the Dow Jones Industrial Average increased 0.62% to 33,944.4 points; the S&P 500 gained 0.24% to 4409.53; and the Nasdaq Composite was up 0.18% to 13,685.48.

Across the Tasman, the S&P/ASX 200 Index has risen 1.27% to 7093.2 points at 6pm NZ time.

Positive property signs

Retirement village operator Summerset Group increased 17c to $10.30 after reporting 273 sales (126 new and 147 resale) for the June quarter – the resales were the highest in the company’s history for one quarter.

Summerset has made 483 settlements during the first half of the 2023 financial year and the company said the tough property market conditions appear to be easing. Uncontracted new sale stock decreased 17% to 256 units at the end of December.

Goodson said Summerset’s quarterly sales were slightly below analysts’ forecasts but not as bad as feared given the paucity of house sales. This means companies should struggle to settle on retirement unit sales, but Summerset brought a little bit of relief.

Fellow retirement stocks Arvida Group gained 2c to $1.25, and Oceania Healthcare was also up 2c or 2.63% to 78c, but Ryman Healthcare declined 13c or 1.88% to $6.80 after a strong run.

Infratil declined 28c or 2.74% to $9.95 as investors digested the latest deal with Hong Kong telco HKT and Console Connect. Infratil is considering a $75m six-year offer of infrastructure bonds, with the ability to accept a further $50m oversubscriptions, to help repay a portion of a bridging loan to fund the purchase of One NZ (formerly Vodafone).

In the energy sector, Mercury declined 7c to $6.44; Meridian decreased 3c to $5.55; Genesis was up 3c to $2.725; and Manawa gained 5c to $5. Chorus was down 7.5c to $8.13 after reporting a $7m impact on operating earnings (Ebitda), with parts of its telecommunications network having to be replaced because of the recent flooding and cyclone. The full-year guidance was $675m-$690m.

Chorus increased fibre connections by 19,000 to 1.031m in the fourth quarter and fibre uptake is now 73% across its ultra-fast broadband footprint.

Freightways shed 12c to $8.41; Serko was down 11c or 2.77% to $3.86; Seeka fell 11c or 3.77% to $2.81; Delegat Group declined 15c to $8.80; and Precinct Properties decreased 3c or 2.32% to $1.265.

Carbon Fund decreased 5c or 3.57% to $1.35; Burger Fuel shed 2.5c or 8.77% to 26c; and CDL Investments was down 2c or 2.53% to 77c.

AFT Pharmaceuticals, gaining 3c to $3.75, told the market it has launched two online stores in Australia and United States through Amazon.

Fisher and Paykel Healthcare collected 21c to $24.21; Ebos Group was up 55c to $38 on trade worth $24.75m; Heartland Group gained 6c or 3.41% to $1.82; Sanford added 8c or 1.97% to $4.14; and Scales Corp increased 8c or 2.41% to $3.40.

Other gainers were Channel Infrastructure, adding a further 5c or 3.18% to $1.62; Vista Group up 6c or 3.35% to $1.85; 2 Cheap Cars rising 6c or 14.29% to 48c; TradeWindow improving 1.5c or 5.26% to 30c; Move Logistics collecting 3c or 3.66% to 85c; and Allied Farmers up 2c or 2.94% to 70c.

Lee Joo Hai is stepping down as a PGG Wrightson director “in order to eliminate the ongoing distraction due to media and market attention regarding the securities regulation matters that he is defending in Singapore". PGG’s share price gained 4c to $4.21.

Karen Lake is moving from Ryman Healthcare’s regional operations manager to group general manager for Promisia Healthcare. Promisia’s share price was unchanged at 0.001c.

Tags: Market Close