NZ sharemarket drifts down in holiday mode

The New Zealand sharemarket was still in holiday mode on Monday, starting the new week on lighter than normal trading and a fall of more than half a percent, as many offices began reopening.

Monday, January 15th 2024, 6:16PM

by BusinessDesk

The S&P/NZX 50 Index continued to drift lower on surprisingly small volumes and closed at 11,772.9, down 85.4 points or 0.72%.

There were 54 gainers and 78 decliners over the whole market, with 14.25 million shares worth $42.4m changing hands.

Matt Goodson, managing director of Salt Funds Management, said there were a lot of small movements on very light turnover. “I wouldn’t read too much into them.

“Over the next few days, as companies see their management accounts for the period ending December, we may see more (trading) updates and more activity,” he said.

Mercury Energy down 14c or 2.11% to $6.50, Summerset Group declining 28c or 2.5% to $10.90, and a2 Milk shedding 10c or 2.24% to $4.36 led the market down.

Among other energy stocks, Manawa was down 7c to $4.33, and Vector declined 7c or 1.85% to $3.71.

Ebos Group was down 35c to $35.65; Chorus decreased 6c to $7.82; Auckland International Airport shed 7.5c to $8.62; Fletcher Building declined 7c to $4.78; and PGG Wrightson shed 8c or 2.36% to $3.31.

Napier Port was down 10c or 3.94% to $2.44 on small trading worth $10,300 after reporting a further fall in container volumes and a recovery in log exports. Container volumes were down 28.3% to 43,000 TEUs (20-foot equivalent units) for the first quarter ending December compared with the previous corresponding period.

Total bulk cargo increased 3.2% to 1.01m tonnes, with the log trade rising 10.6% and continuing the positive momentum seen in the fourth quarter last year, the port company said.

Goodson said Napier’s numbers are not too much of a worry – it’s how they fare with the horticultural volumes and Pan Pac’s pulp and paper operation getting up and running in the Hawke’s Bay following Cyclone Gabrielle.

Property news

Vital Healthcare Property Trust, declining 1.5c to $2.165, told the market that it expects a $145m, or 4.4%, revaluation loss on its portfolio for the six months ending December.

Vital sold five aged care facilities leased to Hall & Prior on December 19 for $65m, and the money will be used to repay debt. The sale price was a 1% discount on the June book value.

Goodson said Vital’s revaluation reflects a further softening in cap rates – 16 basis points across the portfolio – because of the recent rally in bond yields.

“Perhaps we are getting towards the end of the cycle for rising yields, but it’s been hard for valuers. The revaluation lifts the debt ratio, and Vital has sold property to keep the debt under control,” he said.

Among other property companies, Investore was down 3c or 2.5% to $1.17, and Goodman Trust declined 5c or 2.22% to 2.20.

Seeka fell 6c or 2.34% to $2.50; Delegat Group shed 10c to $6.70; Gentrack declined 12c or 1.8% to $6.53; Arvida Group was down 3c or 2.48% to $1.18; and Air NZ decreased 1c to 63.5c.

Other decliners were NZ Rural Land Company, down 2c or 2.38% to 82c; Geneva Finance, shedding 2c or 5.56% to 34c; and ikeGPS, decreasing 2c or 3.7% to 52c.

In Australia, Super Retail – owner of Super Cheap Auto, Rebel Sport and Macpac –increased 5.9% to A$16.73 (NZ$17.96) after indicating first-half revenue of A$2.02 billion, a rise of 3% and gross profit of $200m-203m, ahead of market expectation. “That’s an interesting lead for retailers here,” said Goodson.

Briscoe Group, owner of Rebel Sport in NZ, was down 3c to $4.62, and The Warehouse declined 5c or 3.11% to $1.56.

T&G Global increased 4c or 2.09% to $1.95; Scales Corp was up 5c to $3.40; and Pacific Edge added 0.002c or 1.9% to 10.7c.

NZ King Salmon Investments was up 0.005c or 1.92% to 26.5c on the day it announced Deloitte Corporate Finance partner Paul Munro as an independent director from March 1. He replaces former chief executive and long-time director, Paul Steere.

Tags: Market Close