by BusinessDesk
The S&P/NZX 50 Index fell 94.42 points, or 0.8 percent, to 11,539.10. Within the index, 34 stocks fell, 11 rose and five were unchanged. Turnover was $171.2 million.
The market started the week with a step down as investors found little distraction from the general economic malaise most of the world has found itself in after the pandemic.
Today’s slide is a continuation of a theme that has been driving the market lower since the index hit a record on Aug. 28.
The strong kiwi dollar, a stern price correction of tech stocks on Wall Street and increased awareness of recessionary conditions has been putting downward pressure on the market for weeks.
“Investors are struggling to find a rationale for buying on this market at the moment,” said Grant Williamson, director of Hamilton Hindin Greene.
“We need something quite big to push the market higher and we are just not seeing that out there at the moment.”
Upcoming elections in both NZ and the United States were adding uncertainty and investors realising the poor economic data, seen in the past week, were signs of a recession approaching rather than passing.
“We are starting to see a number of investors take profits, particularly on stocks that have done well this year,” Williamson said.
Three of the year’s best performing stocks made up three of the five biggest declines on the day: Pushpay Holdings fell 3.8 percent to $7.60, Fisher & Paykel Healthcare dropped 3.3 percent to $31.19 and Chorus declined 3.2 percent to $8.80.
The market was led lower by travel software provider Serko which fell 4.6 percent to $4.53 on its first day trading as part of the NZX 50 index. The fall follows an almost 12 percent bounce in the week leading up to its inclusion.
Vista Group International also fell 3.4 percent to $1.71, after hitting a six-month high in early September.
Retailer Kathmandu posted the day’s biggest gain, climbing 3.2 percent to $1.28 ahead of its full year earnings report on Wednesday. The stock has climbed 10 percent in the past week.
Genesis Energy rose 1.4 percent to $2.88 and Contact Energy rose 1.1 percent to $6.27.
“There is still a little bit of demand for the high yield stocks due to the low interest rate environment, but there is not as much demand for the growth stocks,” Williamson said.
Air New Zealand dropped 1.5 percent to $1.31, while Auckland International Airport rose 0.7 percent to $6.98.
Spark New Zealand rose 0.7 percent to $4.60 and A2 Milk Company was up 0.9 percent at $17.86, gaining with other dairy stocks: Synlait Milk advanced 2.6 percent to $5.95 and Fonterra Shareholders Fund units increased 0.3 percent to $4.07.
The kiwi dollar opened at 67.55 US cents and made muted gains ahead of the Reserve Bank’s meeting on Wednesday, trading at 67.71 cents at 5pm in Wellington, down from 67.87 cents on Friday.
The trade-weighted index was at 72.38 at 5pm, from 72.61 on Friday. The kiwi traded at 92.45 Australian cents up from 92.72 cents, 70.62 yen from 71.13 yen, 57.06 euro cents from 57.28 cents, 52.26 British pence from 52.37 pence, and 4.5756 Chinese yuan from 4.5845 yuan.
| « Strong kiwi weighs down shares | NZ shares buck global sell-off » |
Special Offers
No comments yet
Sign In to add your comment
© Copyright 1997-2024 Tarawera Publishing Ltd. All Rights Reserved