by BusinessDesk
By Dan Brunskill
Feb. 27 (BusinessDesk) -
The S&P/NZX 50 Index declined 96.69 points, or 0.8 percent, to 11,437.17. Within the index, 31 stocks fell, 14 gained, and five were unchanged. Turnover was $191.2 million.
David Price, an equity manager at Forsyth Barr, said the market turned after the Centers for Disease Control and Prevention in the United States reported a new case of covid-19 in California that had no obvious links to China, suggesting the virus may be spreading in the US.
Following the news, equity markets across the globe turned red. The S&P 500 was down 0.4 percent, the Dow Jones fell 0.5 percent, the Hang Seng in Hong Kong was down 0.4 percent and Australia’s S&P/ASX 200 fell 1 percent.
Sky Network Television, which is overhauling its satellite business to compete with streaming rivals, led the market lower for a second day. The shares sank 10.7 percent to a new record low of 50 cents on a volume of 560,000 shares.
Energy retailers came under pressure. Meridian Energy fell 7.7 percent to $4.7 with 2.2 million shares changing hands. Mercury NZ followed close behind, declining 6 percent to $4.815 and Contact Energy slipped 2.4 percent to $6.85.
Price said the uncertainty around Rio Tinto’s Tiwai Point aluminium smelter was putting downside risk on energy retailers, making them first in line for investors looking to reduce risk.
“Contact has done well on a relative basis. If the smelter were to close, Meridian and Contact would be the two worst affected,” he said.
New Zealand Refining Company fell 6.6 percent to $1.28. Today it reported an 86 percent drop in net profit after the US-China trade war and new marine fuel standards slashed margins.
The stock has fallen about 23 percent since Jan. 21 when the company said its average margin for 2019 had fallen to a five-year low. Today the company said it would withhold its dividend to help the company navigate the difficult outlook.
Z Energy, which has a 15 percent stake in the refinery, also fell 4.7 percent to $4.24 on a volume of 1.5 million shares.
Air New Zealand fell 1.3 percent to $2.37 after noting weaker earnings in its half-year report, down 8.8 percent to $198 million from $217 million a year earlier.
The airline said it will look to stoke demand on its domestic and trans-Tasman routes to counter the impact of the coronavirus outbreak on international demand. The interim dividend remained unchanged at 11 cents per share.
Vista Group International rose 4.3 percent to $3.15 despite reporting a result weakened by covid-19.
The cinema software company announced it was pausing the purchase of an additional stake in Vista China until the impact of the coronavirus crisis became clear. Annual net profit fell 1.5 percent with revenue growth of 11 percent, as the company increase market share outside of China.
A2 Milk rose 4.7 percent to $16.42 with 2.6 million shares being traded, posting the biggest gain on the day. The company reported a 21.1 percent jump in first-half net profit and said the scale of its infant nutrition business meant it was now looking at additional manufacturing.
Price said the stock gaining against the market was a “huge performance” and the annual report was reassuring for investors to see earnings were on track despite coronavirus disruptions to a key market.
Shares in tech component maker Rakon rose 14.6 percent to 27.5 cents following a media report that it had received private equity interest. About 585,000 shares traded hands, more than 6 times its 90-day average, despite chair Bruce Irvine saying the company was unaware of any takeover or investment.
| « Pandemic fears drive NZ shares lower for a second day consecutive day | Companies take a hit a coronavirus fears spread » |
Special Offers
No comments yet
Sign In to add your comment
© Copyright 1997-2024 Tarawera Publishing Ltd. All Rights Reserved