NZX up more than 0.5% as weak dollar boosts some stocks

Global exporters Fisher and Paykel Healthcare and a2 Milk, helped by a weaker currency, led the New Zealand sharemarket higher, rising more than 0.5%.

Tuesday, July 30th 2024, 6:21PM

by BusinessDesk

The S&P/NZX 50 Index bounced at the opening and traded steadily throughout the day to close at 12,391.05, a gain of 77.43 points or 0.63% after reaching an intraday high of 12,435.96.

The index has now risen nearly 5.25% so far this year. There were 79 gainers and 54 decliners on the main board, with 45.49 million shares worth $127.32m changing hands.

Jeremy Sullivan, an investment adviser with Hamilton Hindin Greene, said the local market was buoyant, with a broad-based rally.

“The market is looking ahead to lower interest rates, and the search for yields (in equities) is starting again,” he said.

ANZ Research said next week’s second-quarter statistics are expected to show further softening in the labour market. Unemployment is expected to rise from 4.3% to 4.7%, slightly above the Reserve Bank’s forecast of 4.6%.

Wage growth in the private sector labour cost index (including overtime) is expected to be 3.6% year-on-year, against 3.8% in the first quarter (Q1), while growth in private sector average hourly earnings (ordinary time) is also expected to slow to 3.8%.

“This is the last big piece of data ahead of the August monetary policy statement, where the market is currently pricing more than a 65% chance of a cut (in interest rates).

We think something close to our forecast is unlikely to push the Reserve Bank into action this early.

“But if recent weakness in forward-looking indicators persists, confirmation from the second quarter data that the labour market is loosening could increase the odds of an October kick-off,” ANZ said.

In the latest NZX statistics, total equity trades fell 19.8% to 3.916m for the six months ending June, and the value traded declined 8.1% to $15.5 billion, with 62.9% on-market.

The average on-market trade size was $2463, up 9.9%. Total capital raisings were $6.33b, down 11.5%. The NZ dollar was trading at US58.9c against the American greenback, having weakened from US61.5c on July 8.

Local market

Market leader Fisher and Paykel Healthcare was up 64c or 2.02% to $32.30, and a2 Milk gained 31c or 4.04% to $7.99, having nearly doubled since November last year when it reached $4.04. Still, a2 Milk is some distance from its high of $21.74 set on Aug 18, 2020.

Mainfreight collected $1.44 or 1.98% to $73.99; Port of Tauranga was up 9c to $5.58; Briscoe Group gained 12c or 2.81% to $4.39; Eroad increased 5c or 3.88% to $1.34; and NZME added 3c or 2.88% to $1.07.

Third Age Health rose 11c or 6.47% to $1.81; Steel & Tube gained 4c or 4.04% to $1.03; Marsden Maritime Holdings increased 9c or 2.69% to $3.44; and 2 Cheap Cars added 2c or 2.35% to 87c.

Amongst the property companies, Kiwi was up 2.5c or 2.86% to 90c; Argosy added 2c or 1.89% to $1.08; and Asset Plus gained 1c or 4.76% to 22c.

Vector, up 2c to $3.71, has conditionally agreed to sell its liquified petroleum gas business, Ongas, and the 60.25% shareholding in Liquigas Limited for $150m.

Accordant Group was unchanged at 67c after receiving a price enquiry from NZX following the share price rise from 43c on July 10 to 65c on July 29 – an increase of 51.16%.

Accordant said it was complying with the continuous disclosure obligations. ANZ Group was down 60c or 1.86% to $31.60; Gentrack shed 19c or 1.84% to $10.11; Green Cross Health was down 2c or 2.22% to 88c; ikeGPS decreased 3c or 4.05% to 71c; and Rakon declined 2c or 2.33% to 84c.

Fast food operators Restaurant Brands declined 14c or 4.39% to $3.05, and Burger Fuel was down 1.5c or 4.84% to $29.50.

Santana Minerals decreased 2.5c to $1.39 after reporting high-grade gold deposits from its ongoing resource definition drilling programmes at the Central Otago Bendigo-Ophir project ahead of its pre-feasibility study.

Santana plans to produce 110,000 ounces a year over ten years for revenue of $4.4b (at a gold price of $3,900 oz) and a net profit of $2b. Total production cost is estimated at $1,392 oz, and $1.7b would stay in NZ through tax, royalty and dividend.

Promisia Healthcare, unchanged at 0.001c, has raised $3m under its share purchase plan and placement and expects to confirm its financial condition for buying two retirement villages in Cromwell.

New Talisman Gold Mines, down 0.001c or 5.26% to 1.8c, raised $1.805m from its rights issue, enabling the company to finalise its processing site and begin bulk sampling on the Mystery Vein at its Karangahake Gorge mine.

Tags: Market Close