Shares dip as investors await US data

The New Zealand sharemarket shed more than half a percent as it waited for the latest United States inflation rate and the Federal Reserve’s stance on interest rates.

Tuesday, December 12th 2023, 6:29PM

by BusinessDesk

The S&P/NZX 50 Index was on a gradual slide all day and closed at 11,382.58, down 66.89 points or 0.58%.

The index has fallen 1% in the last two trading days and is now 0.8% behind for the year to date. There were 50 gainers and 79 decliners over the whole market on volumes of 42.37 million share transactions worth $100.11 million.

Mark Lister, investment director with Craigs Investment Partners, said it’s understandable that the local market has taken a breather after a six-week winning streak, the longest in a year.

He said the next two days are crucial if the rally continue: “The US November consumer price index is followed by the Federal Reserve’s monetary policy statement.

“We will see if the markets get what they want. The markets will be watching to see whether the Fed talks tough like our Reserve Bank and pours cold water on their hope for interest rate cuts,” Lister said.

The US markets remain positive. The Dow Jones Industrial Index was up 0.43% to 36,404.93 points; the S&P 500 increased 0.39% to 4622.44; and the Nasdaq Composite gained 0.2% to 14,432.49.

Across the Tasman, the S&P/ASX 200 Index was up 0.51% to 7235.8 points at 6pm NZ time.

US inflation is expected to fall to 3.4%, down 0.2% from the year ending October, and the lowest level since April 2021. The Fed is also expected to keep its cash rate on hold and the markets are still predicting interest rate cuts next year.

At home, Ebos Group fell $2.15 or 5.73% to $35.35; Fletcher Building was down 8c to $4.57; Freightways shed 10c to $8.27, Skellerup Holdings declined 17c or 3.39% to $4.84; Vulcan Steel decreased 26c or 3.25% to $7.74; and T&G Global was down 14c or 6.86% to $1.90.

Energy stocks slip

In the energy sector, Mercury decreased 12.5c or 2% to $6.135; Contact was down 12c to $7.72; and Vector shed 7c or 1.84% to $3.73.

Port of Tauranga declined 14c or 2.57% to $5.30 following the report that Bay of Plenty Regional Council is reviewing its majority shareholding.

Synlait Milk fell under $1 for the first time in 20 years after declining 8c or 7.62% to 97c. Synlait and Pacific Edge, down 0.002c or 2.3% to 8.5c, are the two worst-performing stocks in the NZX top 50 over the past 12 months, having fallen 77% and 83% respectively.

Online travel provider Serko, up 9c or 2.14% to $4.29, is the best performer, having risen 69.35%.

Other gainers were Auckland International Airport, adding 7c to $8.30 ahead of tomorrow's expected release of input methodologies decisions from its regulator, the Commerce Commission. Sky TV up 6c or 2.21% to $2.78 and Bremworth increased 4c or 7.14% to 60c.

Hallenstein Glasson was down 18c or 3.23% to $5.40 after telling shareholders at the annual meeting that group sales declined 4.7% for the first 19 weeks of the new financial year compared with the same period last year. However, gross margin has increased despite the continued strength of the US dollar.

In the property sector, Investore fell 5c or 4.55% to $1.05, and Precinct was down 3c or 2.5% to $1.17.

SkyCity Entertainment, down 3c to $1.75, has settled its dispute with MPF Parking NZ, paying compensation of $204m for the return of an Auckland car park.

Takeover target Rakon declined 6c or 5% to $1.14 on 321 trades worth $2.148m.

Other decliners were Comvita, falling 13c or 5.53% to $2.22; Delegat Group decreasing 11c to $6.58; NZME shedding 3c or 3.33% to 87c; PGG Wrightson down 11c or 3.19% to $3.34; and 2 Cheap Cars giving up 3c or 3.41% to 85c.

Tags: Market Close