NZ sharemarket rebounding strongly

The New Zealand sharemarket continued its rebound, with bellwether stocks Mainfreight and Freightways making ground and a softer labour market keeping a lid on inflation.

Wednesday, November 1st 2023, 6:37PM

by BusinessDesk

The S&P/NZX 50 Index traded strongly in the afternoon after reaching a morning low of 10,725.5 and closed at 10,850.92, up 93.23 points or 0.87% – the biggest single-day rise in 10 weeks.

There were 84 gainers and 45 decliners on the main board, with 26.05 million shares worth $102.92 million changing hands.

The last two days of rises are a welcome relief for investors after the NZX index fell 4.8% in October – the biggest monthly decline since 4.9% in May last year. The index also fell 4.2% in August.

Unemployment rose to 3.9% in the year ending September, from 3.6% previously, and the employment rate fell to 69.1% from a high of 69.8% in the previous quarter.

Matt Goodson, managing director of Salt Funds Management, said private sector wage inflation eased, but the public sector was still strong. The unemployment data caused a modest decline in bond yields, with the NZ 10 Year Government Bond yield drifting to 5.51%.

“This provides hope that the Reserve Bank will keep the official cash rate (OCR) on hold and interest rates will start easing mid to late next year,” Goodson said.

ANZ Research said the labour market continued to move in the right direction for the Reserve Bank, but there’s still a fair way to go to generate the necessary slack and get on top of domestic inflation.

ANZ is still forecasting a further 25 basis points rise in the OCR, but it may now be later than February and “indeed no further hikes if the ducks line up”.

The major United States indices also rose for the second successive day; gold continued to fall to US$1,975.73 (NZ$3,402.47) an ounce, and the NZ dollar was weaker at US58.05c against the American greenback after hitting an intraday low of US57.88c.

The NZX index was working in tandem with its Australian counterpart, with the S&P/ASX 200 Index up 0.72% to 6,829.2 points at 6pm NZ time.

Transport and logistics companies Mainfreight and Freightways, under earnings pressure and missing the usual positive investor sentiment, continued to make headway. Mainfreight rebounded a further $1.10 or 1.94% to $58.35, and Freightways rose 40c or 5.37% to $7.85.

Market leaders Meridian was up 6c to $4.89; Fisher and Paykel Healthcare increased 29c to $21.10; Ebos Group added 78c or 2.23% to $35.77; and Auckland International Airport gained 11c to $7.45.

Infratil rose 33c or 3.36% to $10.15; Synlait gained 6c or 4.51% to $1.39; Heartland Group was up 5c or 3.27% to $1.58; and Smartpay Holdings increased 8.5c or 6.54 % to $1.385.

Gentrack was up 20c or 4.08% to $5.10; Sanford gained 11c or 2.93% to $3.87; NZME improved 4c or 4.82% to 87c; PaySauce increased 1.3c or 7.65% to 18.3c; and AFT Pharmaceuticals collected 6c or 1.8% to $3.40.

Mercury Energy fell 22.5c or 3.81% to $5.675; Chorus was down 8.5c to $7.09; Arvida Group shed 4c or 3.45% to $1.09; Seeka decreased 8c or 3.32% to $2.33; and Vital Healthcare Property Trust declined 5c or 2.5% to $1.95.

Stride Property, volatile of late, was down 6c or 4.41% to $1.30; SkyCity Entertainment declined 4c or 2.14% to $1.83; and Rakon decreased 4c or 5.71% to 66c.

Transport technology company Eroad was up 2c or 3.08% to 67c after announcing two new deals in Australia for its vehicle tracking devices. Eroad has expanded its existing partnership with construction firm Boral and become the preferred supplier for Woolworth’s 1,100-strong fleet.

Tags: Market Close