by BusinessDesk
The S&P/NZX 50 Index increased 250.92 points, or 2.5 percent, to 10,409.94. Within the index, 44 stocks rose and six fell. Turnover was $340 million.
Investors were cheered by the slowing pace of new covid-19 cases in New Zealand and the increasing the likelihood lockdown conditions will be eased next Wednesday. They continued to buy into stocks which have been sold off sharply through the crisis.
Grant Davies, an investment adviser at Hamilton Hindin Greene, said confidence was returning to the market despite the risk of more bad news in the medium term.
“There is still good value in the market, a lot of these stocks are sold off from previous levels and from a long-term perspective there is some pretty good buying,” he said.
Proposed tax reform to let previously profitable companies claim forecast losses may also have offered investors a sense of security.
Davies said a number of today's leaders had faced the biggest falls earlier in the year.
Vista led the market higher jumping 20.7 percent to $1.40, Air New Zealand advanced 13.5 percent to $1.18 and Kathmandu increased 11.6 percent to 77 cents.
Davies said news that Norges Bank Investment Management, which manages Norway's pension fund, had bought a 5 percent stake in Kathmandu may have also supported investor confidence.
Refining NZ climbed 15.1 percent to 99 cents following a strategic review to ensure the long-term viability of the business. The review includes whether or not to break up its operations or move to a fuel import model.
Davies said that investors were likely reassured by the refinery making early moves to protect the long-term outlook.
“In this market investors just want to know what each company is doing and sometimes just an update on that is enough to give people enough confidence to start buying again,” he said.
A2 Milk rose 4 percent to an all-time high of $19.10 as it benefitted from weakness in the New Zealand dollar and healthy demand for its products.
“They’ve ridden out the sell-off sentiment and then some, continuing to reward patient investors,” Davies said.
Property For Industry declined 1.5 percent to $2.01 after pulling its earnings and dividend guidance warning it may have to provide assistance to some of its tenants in the short term to protect the long-term earnings of the company.
Other property stocks were stronger. Argosy Property rose 5.6 percent to $1.03, Kiwi Property Group increased 2.6 percent to 98 cents and Goodman Property Trust advanced 2.1 percent to $2.175.
PaySauce rose 12.5 percent to 45 cents after it reported it had doubled year-on-year earnings and raised $4 million of fresh capital during the previous quarter.
SeaDragon fell 16 percent to 10.5 cents after announcing it would seek to delist from the NZX in an effort to cut regulatory costs following another year of losses.
Port of Tauranga posted the biggest fall on the NZX50, dropping 2.4 percent to $6.66.
| « NZ shares close at month-high on optimism over covid-19 response | NZ shares rise as investor FOMO stokes demand for beat-up stocks » |
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