5th worst year for NZX50 in 15 years

The New Zealand sharemarket finished “a roller coaster” year with a 2.6% gain after seeing in the New Year on a flat note.

Friday, December 29th 2023, 5:29PM

by BusinessDesk

The S&P/NZX 50 Index had a bumpy half-day trading session and closed at 11,770.49, up 1.81 points or 0.02% after reaching an intraday low of 11,745.1.

There were 71 gainers and 48 decliners over the whole market on light volumes of 12.89 million share transactions worth $27.67m.

The NZX top 50 index had its fifth worst 12 months in 15 years. The global financial crisis in 2008 sent the market down 32.8%. Since then, the only down years were minus 1.04% in 2011, 0.4% in 2021 and 12% last year. The index had a gain of 13.92% in 2020.

The best year was 2019 with a rise of 30.42%, followed by 24.18% in 2012, and 22.04% in 2017. Since 2001, the index has averaged an annual gain of 8.9%.

Shane Solly, portfolio manager with Harbour Asset Management, said it was a damp end to this year following two strong months of trading.

“It’s been a roller coaster year and to finish ahead is no mean feat. We had a good rally early in the year, bumped along mid-year and by October when interest rates had increased strongly the market reached its low.

“Then we flipped the switch in early November when central banks started talking about pausing interest rate rises and thinking more about avoiding a recession,” Solly said.

The NZX index reached a low of 10,741.57 points on October 30, falling 7% for the year, and then went on a strong run, rising 9.6% over November and December.

Solly said next year was likely to be another volatile and bumpy period on the market. “The fall in interest rates will take some pressure off the market, but we still have an economy that is resetting and (corporate) earnings risks coming through.

“I think it will still be a net positive year. There is likely to be some merger and acquisition activity and earnings are near the bottom for some companies, providing a base for growth,” he said. “People just need to think medium to long term when investing in the sharemarket.”

In today's trading

On the last day of trading for 2023, Ryman Healthcare gained 11c or 1.88% to $5.95; Port of Tauranga collected 9c to $5.62; Contact Energy was up 12c to $8.14; Heartland Group rose 6c or 4.17% to $1.50; and Restaurant Brands increased 19c or 5.01% to $3.98.

Restaurant Brands told the market that its Australian subsidiary QSR Pty has been joined to another Federal Court class action filed by Gordon Legal. Shine Lawyers has also taken similar action that includes competitor Collins Foods.

The legal action alleges that between December 2017 and 2023, KFC employees were not provided with paid 10-minute rest breaks.

NZME rose 5c or 4.85% to $1.08; Winton Land was up 5c or 1.82% to $2.80; Delegat Group rebounded 10c to $6.50; Argosy Property gained 2c or 1.79% to $1.135; and Synlait Milk picked up 2c or 2.15% to 95c.

Steel & Tube increased 4c or 3.74% to $1.11; Pacific Edge gained a further 0.008c or 7.41% to 11.6c; software firm Blackpearl Group was up 1.5c or 3.13% to 49.5c; and CDL Investments added 2c or 2.5% to 82c.

Amongst the retailers, KMD Brands was up 3c or 4.11% to 76c; Briscoe gained 4c to $4.47; and Hallenstein Glasson declined 9c to $5.20.

Fisher and Paykel Healthcare was down 18c to $23.47; Ebos Group declined 40c to $35.10; Mercury Energy shed 9.5c to $6.605; Geneva Finance fell 2c or 5.41% to 35c; 2 Cheap Cars decreased 4c or 4.65% to 82c; and My Food Bag was down 0.008c or 4.71% to 16.2c.

Health and wellness company Me Today fell 50% to 0.001c after announcing a share consolidation in the New Year, with 100 shares being exchanged for one share.

Tags: Market Close