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NZ shares surge as Trump puts stimulus back on table

New Zealand’s benchmark share index surged to a record as global risk appetite came flooding back on the hope of fiscal stimulus before the US election.

Thursday, October 8th 2020, 6:50PM

by BusinessDesk

 

The S&P/NZX 50 Index rose 219.77 points, or 1.8 percent, to an all-time high of 12,235.92. Within the index, 36 stocks rose, five fell and nine were unchanged. Turnover was $149.5 million.

US shares lifted on Wednesday night as President Trump urged Congress to pass piecemeal fiscal support bills, despite calling off negotiations for a comprehensive stimulus bill the previous day.

The three main Wall Street indices each closed almost 2 percent higher and Australasian markets followed them.

The Reserve Bank reaffirmed it was planning to ease monetary policy even further with negative interest rates and a funding-for-lending programme in the works, underpinning sentiment.

While the news flow has been positive, conditions have not changed as significantly as the rally might suggest.

“That’s just how markets operate sometimes, its why you’ve got to stay invested,” said Peter McIntyre, an advisor at Craigs Investment Partners. “The urging from Trump to bring him bills to sign after previously telling them to walk away has got the market excited.”

Vista Group International led the market higher, leaping 9.7 percent to $1.59 as it rallied from recent losses following announcements of cinema closures in key markets. 

SkyCity Entertainment Group, another recovery stock, climbed 4.7 percent to $3.14.

Meridian Energy rose 4.6 percent to $5.50 and Contact Energy advanced 3.9 percent to $7.55, both attracting investors due to the possibility of Tiwai Point aluminium smelter’s life being extended, McIntyre said.

The risk-on mood in the US markets helped to buoy Pushpay Holdings, which rose 3.3 percent to $8.99 and Fisher & Paykel Healthcare, which climbed 3.4 percent to $34.44.

Retirement village operator Summerset Group rose 1.6 percent to $9.30 after selling a record number of new and existing units in the September quarter.

The encouraging news spilled over to some other retirement stocks, McIntyre said, with Oceania Healthcare rising 3.3 percent to $1.24 and Argosy Property climbing 1.4 percent to $1.41. However, Ryman Healthcare declined 0.3 percent to $14.80.

Travel software company Serko posted the day’s biggest decline, falling 3.3 percent to $4.69 after a strong run upwards. It was one of just a handful of stocks that declined, while 15 gained more than 2 percent.  

The New Zealand dollar failed to capitalise on improved market sentiment, continuing to ease slightly lower against the greenback without a clear catalyst.

The kiwi dollar was trading 65.71 US cents at 5pm in Wellington, down from 65.88 cents yesterday.

The Reserve Bank's latest dovish comments caused the kiwi to briefly tumble as low as 65.46 before recovering. 

The trade-weighted index was at 70.83 at 5pm, from 71.10 yesterday. The kiwi traded at 91.99 Australian cents from 92.55 cents, 69.64 yen from 69.63 yen, 55.82 euro cents from 56.16 cents, 50.81 British pence from 51.13 pence, and 4.4616 Chinese yuan from 4.4731 yuan.

Tags: Market Close

« Kiwi falls as Trump spikes stimulus dealHot property market drives shares higher »

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Lender Flt 1yr 2yr 3yr
AIA 4.55 2.55 2.69 2.79
ANZ 4.44 3.15 3.25 3.39
ANZ Special - 2.55 2.69 2.79
ASB Bank 4.45 2.55 2.69 2.79
Bluestone 3.49 3.49 3.49 3.49
BNZ - Classic - 2.55 2.69 2.79
BNZ - Mortgage One 5.15 - - -
BNZ - Rapid Repay 4.60 - - -
BNZ - Std, FlyBuys 4.55 3.15 3.29 3.39
BNZ - TotalMoney 4.55 - - -
CFML Loans 4.95 - - -
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China Construction Bank 4.49 4.70 4.80 4.95
China Construction Bank Special - 2.65 2.65 2.80
Credit Union Auckland 5.45 - - -
Credit Union Baywide 5.65 3.95 3.85 -
Credit Union South 5.65 3.95 3.85 -
First Credit Union Special 5.85 2.95 3.45 -
Heartland 3.95 2.89 2.97 3.39
Heartland Bank - Online 2.95 1.99 2.35 2.45
Heretaunga Building Society 4.99 3.50 3.40 -
HSBC Premier 4.49 2.45 2.60 2.65
HSBC Premier LVR > 80% - - - -
Lender Flt 1yr 2yr 3yr
HSBC Special - - - -
ICBC 3.69 2.45 2.65 2.79
Kainga Ora 4.43 2.93 3.07 3.24
Kainga Ora - First Home Buyer Special - 2.25 - -
Kiwibank 3.40 3.30 3.54 3.54
Kiwibank - Offset 3.40 - - -
Kiwibank Special 3.40 2.55 2.79 2.79
Liberty 5.69 - - -
Nelson Building Society 4.95 3.45 3.49 -
Pepper Essential 4.79 - - -
Resimac 3.39 3.35 2.99 3.35
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SBS Bank Special - 2.55 2.49 2.49
The Co-operative Bank - First Home Special - - - -
The Co-operative Bank - Owner Occ 4.40 2.55 2.69 2.79
The Co-operative Bank - Standard 4.40 3.05 3.19 3.29
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Westpac 4.59 ▼3.09 3.29 3.39
Westpac - Offset 4.59 - - -
Westpac Special - ▼2.49 2.69 2.79
Median 4.55 2.94 2.99 2.80

Last updated: 23 October 2020 5:00am

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