NZX50 flat as companies go ex-dividend

The New Zealand sharemarket held its ground as a bunch of stocks went ex-dividend, and offshore bourses were decidedly weaker.

Thursday, September 7th 2023, 6:34PM

by BusinessDesk

Apart from a lunchtime dip, the S&P/NZX 50 Index traded steadily and closed at 11,426.84, down 0.82 points or 0.01%.

There were 48 gainers and 89 decliners on the main board, with 31.13 million shares worth $157.75m changing hands.

Paul Robertshawe, chief investment officer with Octagon Asset Management, said the local market was in a bit of a lull, but “we have had a big correction through the reporting season, and that’s cleared the air. I feel okay about the market.

“It looks like we are going through one of those phases where good news is bad news. There was a strong purchasing managers index in the US, and people are still spending,” he said.

The August services data showed prices increased to the highest level since February, with the ISM purchasing index jumping from 52.7 to 54.5, above market expectation of 52.5. This stoked fears that the US Federal Reserve will need to raise interest rates one more time.

The Dow Jones Industrial Average was down 0.57% to 34,443.19 points; S&P 500 declined 0.7% to 4465.48; and Nasdaq Composite shed 1.06% to 13,872.47. The Hong Kong Hang Seng Index had fallen 1.14% to 18,240.48 points at 6pm NZ time; the Japan Nikkei 225 was down 0.55% to 33,058.68; the Shanghai Composite had declined 0.99% to 3126.8; and the Australian S&P/ASX 200 Index was down 1.17% to 7172.2.

There was some cheery news for the agriculture sector and the national economy, with dairy prices ending a four-month slide in the latest Global Dairy Trade auction. Prices overall were up by 2.7%, following the 7.4% fall at the last auction in mid-August.

Whole milk powder prices firmed 5.3% to US$2702 a tonne after falling 10.9% to a five-year low last month. Skim milk powder eased 1.6% to US$2286 a tonne.

At home, Air NZ, Contact Energy, Ebos Group, Michael Hill, SkyCity, Sky TV and Steel & Tube all went ex-dividend.

Back in NZ

In its report on the June-end reporting season, Forsyth Barr said the period recorded the highest proportion of earnings downgrades for at least a decade, which is how long it has had reliable information.

The broker said the downgrades were broad-based but primarily driven by operational expenditure and interest expense rather than revenues.

“We have been in a downgrade cycle for some time, but what stands out this earnings season is that it has spread from economically sensitive stocks, such as retail and industrials, through to infrastructure. Of the 10 companies with the largest downgrades, four were infrastructure companies,” said Forsyth Barr.

Contact Energy increased 10c to $8.20; Air NZ was up 1.5c or 1.97% to 77.5c; Sky TV gained 8c or 3.51% to $2.36; SkyCity added 3c to $2; and Steel & Tube improved 4c or 3.51% to $1.18.

Meridian Energy was up 6.5c to $5.30; Skellerup Holdings added 8c or 1.82% to $4.47 following its strong financial result; Napier Port collected 5c or 2.29% to $2.23; Foley Wines gained 3c or 23.46% to $1.25; and Allied Farmers rose 3c or 4.29% to 73c.

Prue Flacks is retiring as chair of the Mercury Energy board at the end of December and will be replaced by Scott St John, a director since 2017. Mercury’s share price was up 10.5c to $6.225.

Auckland International Airport was down 7c to $8.06. Global investment manager BlackRock notified its funds had increased their stake in the airport from 6.017% to 7.058%, as outlined in a substantial product holder notice.

Delegat Group declined 22c or 2.64% to $8.11; Freightways was down 9c to $8.41; a2 Milk shed 6c to $4.69; Winton Land decreased 5c or 2.17% to $2.25; Westpac was down 40c to $22.90; and PGG Wrightson gave up 9c or 2.22% to $3.96.

Michael Hill was down 2.2c or 2.2% to 97c; Vital Healthcare Property Trust declined 6c or 2.75% to $2.12; Hallenstein Glasson shed 16c or 2.62% to $5.94; Smartpay Holdings decreased 3c or 1.85% to $1.59; and MHM Automation fell 4c or 4.04% to 95c.

Vista Group declined 7c or 4.52% to $1.48; Bremworth was down 2c or 4% to 48c; Task Group decreased 1.5c or 3.13% to 46.5c; Just Life Group shed 1.5c or 3.9% to 37; and Blackpearl slipped 2c or 3.39% to 57c.

Transport technology company Eroad went into a trading halt after announcing it was raising $50m - $11.6m through an institutional placement and $38.4m in a one-for-2.06 shareholder entitlement offer at 70c a share. Eroad last traded at $1.39.

Tags: Market Close