NZ sharemarket inches into positive territory on flat trading

The New Zealand sharemarket, lacking some direction, staged a late recovery and finished flat on another quiet trading day.

Tuesday, January 16th 2024, 6:40PM

by BusinessDesk

The S&P/NZX 50 Index dipped at lunchtime when the Australian market opened weaker but rose strongly in the last half-hour matching session.

The NZX index closed at 11,751.04, down 2.14 points or 0.02%, after reaching an intraday low of 11,717.97.

The S&P/ASX 200 Index had fallen 1.1% to 7413.6 points at 6pm NZ time.

There were 70 gainers and 58 decliners on the local market, with 15.32 million shares worth $50.95m changing hands.

Jeremy Sullivan, investment advisor with Hamilton Hindin Greene, said, “We’ve had a gentle start to the year after the strong rally at the end of last year.

“People are watching the developments out of the Middle East and what they will do to inflation and interest rates. All eyes will be on the New Zealand consumer price index next week – it will be four months since we’ve had inflation data.”

Sullivan said freight rates have increased 150% over the past two weeks, which could impact (global) inflation.

Shipping lines charge more for container movements as their vessels take the longer route around southern Africa’s Cape of Good Hope, bypassing the Red Sea and Suez Canal because of safety concerns following a spate of attacks by Houthi militants.

Back home, the NZ Institute of Economic Research’s Quarterly Survey of Business Opinion revealed that confidence rose sharply in the final three months of last year.

A net 10% of respondents expected economic conditions to worsen this year compared with 49% in the September quarter survey.

A net 6% of firms reported an increase in their own trading activity in the December quarter, and a similar portion felt positive about their activity in the upcoming quarter.

ANZ Research said the labour market indicators were a mixed bag, with hiring intentions increasing, but labour is now much easier to find as immigration has soared.

After many stubborn quarters, pricing and cost measures fell meaningfully but do not yet look consistent with inflation back in the Reserve Bank’s target band.

“Overall, the Reserve Bank will be pleased to see the decline in direct inflation indicators, but wary of the forward-looking indicators that suggest a risk that the economy may be getting a second wind before the inflation-fighting job is done,” ANZ Research said.

On the market

Fisher and Paykel Healthcare dragged the market down, falling 38c to $23.56, while Fletcher Building declined 9c or 1.88% to $4.69.

Vulcan Steel was down 32c or 3.88% to $87.93; Serko shed 15c or 3.57% to $4.05; a2 Milk declined 7c to $4.29; Seeka decreased 6c or 2.4% to $2.44; Rakon gave up 6c or 4.58% to $1.25; and Allied Farmers fell 4c or 4.76% to 80c.

Retail and property stocks had a stronger day. Hallenstein Glasson increased 20c or 3.68% to $5.64; The Warehouse gained 4c or 2.56% to $1.60; Briscoe Group was up 6c to $4.68 but Michael Hill was down 2c or 2.11% to 93c.

In the property sector, Goodman Trust was up 6c or 2.73% to $2.26; Precinct gained 3c or 2.38% to $1.29; and Kiwi added 1.5c to 87.5c.

Contact Energy increased 17c or 2.13% to $8.17; Mainfreight collected 27c to $71.27; Freightways gained 14c to $8.60; Ryman Healthcare was up 10c to $5.95; Skellerup added 6c to $4.88; and Heartland Group improved 4c or 2.82% to $1.46.

New Zealand King Salmon Investments gained 1c or 3.77% to 27.5c after telling the market it has received “a positive aquaculture decision” from Fisheries New Zealand for its proposed Blue Endeavour open ocean farm in Cook Strait.

Tower, unchanged at 61c, is selling its Vanuatu business to Capital Insurance Group of Papua New Guinea for $1.6m. The Vanuatu subsidiary generated $6.8m gross written premiums and had a net loss of $5.3m for the year ending September. It has assets of $2.2m.

Cooks Coffee Company, down 1c or 5.88% to 16c, reported a 15.8% increase in UK and Ireland store sales to $53.8m for the last calendar year.

Tags: Market Close