by BusinessDesk
The S&P/NZX 50 Index gained 183.57 points, or 1.6 percent, to 11,736.73. Within the index, 27 stocks rose, 15 fell, and eight were unchanged. Turnover was $153.1 million.
Asian markets took their cue from the tech-heavy Nasdaq Composite Index hitting a new record as vaccine data was released and investors looked towards US earnings season. Australia’s S&P/ASX 200 was up 2.3 percent in late trading while Hong Kong’s Hang Seng rose 1.8 percent.
The rush to buy was driven by corporate reporting in the US, where investors are hopeful technology companies will continue to lift earnings despite the pandemic.
“It’s all about tech and high-multiple stocks being aggressively chased once more in that US market,” said Matthew Goodson, director of Salt Funds Management.
Because the NZX has a limited number of technology stocks, upbeat investor sentiment translated into generalised buying across the board, he said.
Meanwhile, optimism that a covid-19 vaccine may be on the horizon after promising data from trials of three candidates also supported buying, but wasn’t the only factor for local investors.
Goodson said some stocks set to benefit from a vaccine weren't outperforming, while others that have benefitted from the virus, such as Fisher & Paykel Healthcare, were among the leaders.
A2 Milk rose 3.3 percent to $21.21, F&P Healthcare gained 2.7 percent at $36.74, Infratil increased 2.8 percent to $4.92 and Genesis Energy was up 3.2 percent to $3.03.
Those heavyweight stocks drove today's gains, while virus sensitive stocks were mixed.
Auckland International Airport rose 3.7 percent to $6.44 and Air New Zealand advanced 2.7 percent at $1.33, both outperforming the broader market. Meanwhile, Vista Group International increased just 1.6 percent to $1.27 and Tourism Holdings was unchanged at $1.78.
“This is more a liquidity-driven rally as opposed to a news-driven rally,” Goodson said.
“Exceptionally low central bank interest rate policies are forcing investors up the risk curve into equities.”
Kathmandu Holdings led the market higher, rising 4.5 percent to $1.16 and SkyCity Entertainment Group rose 4.1 percent to $2.54.
Tech stock Pushpay Holdings rose 1.8 percent to $7.81. Telecommunications firm Spark New Zealand was up 1.7 percent to $4.84 and internet infrastructure provider Chorus fell 2.1 percent to $7.31.
Fishery firm Sanford posted the day’s biggest decline, dropping 2.9 percent to $6.35.
Outside the NZX 50 benchmark, PGG Wrightson fell 2.7 percent to $2.91 after it said it would report operating earnings between $23 million to $24 million for the June year. That was in line with the previous year, though down from its $30 million guidance that was subsequently withdrawn due to the pandemic.
| « NZ shares fall as investors worry about virus spread | A2 and F&P Healthcare pull the market down » |
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