NZ shares rally as oil prices retreat

New Zealand shares followed a global rally Thursday as oil prices retreated, and Ukraine’s president said one of Russia’s negotiating demands could be met.

Thursday, March 10th 2022, 7:06PM

by BusinessDesk

The S&P/NZX 50 Index rose 140 points, or 1.2%, to 11,926.26. Turnover was $184 million.

Wall Street equity indices were higher overnight as oil prices dropped more than 10% when two members of the OPEC oil cartel said they would support increasing production. 

Oil prices dropped to approximately US$110 (NZ$160) per barrel after having traded at over US$130 on Wednesday, boosting investor sentiment.

“Lower energy prices are a double win for the global economy. Higher prices potentially destroy demand and choke off growth, while simultaneously driving inflation higher,” said Michael McCarthy, chief strategy officer at Tiger Brokers Australia.

Devon Funds’ Greg Smith said the pullback in commodity prices saw most sectors move higher, including the banks, technology and airlines, while energy stocks softened.

Fleet management company Eroad jumped almost 11% to $3.87 on light volume.

Pacific Edge rose 6.9% to 93 cents and Serko gained 4.7% at $4.71. Both are growth stocks that have been badly hit during the past couple of months.

Some fund managers are taking advantage of the low shares prices to build their positions in these companies.

Fisher Funds today disclosed they had bought another approximately 3.5 million shares in Vista Group for about $7m in the past few months. It now owns 15% of the company.

Vista Group International rose half a percent to $1.80 today but has fallen 25% year-to-date.

Some investors have been selling Air NZ due to the high oil prices, but it bounced back 4.4% to $1.43 today. Auckland International Airport rose 3.5% to $7.15.

Carbon Fund units also recovered 4% to $2.09 as the prospect of more normal rates of fuel consumption, and therefore carbon emissions, returned.

ANZ Bank and Westpac Bank both rose more than 3% to $27.78 and $24.42, respectively.

Genesis Energy was the day’s biggest loser, falling 2.5% to $2.80, while other energy stocks also reported small losses.

Meridian Energy dropped 1% to $5.08, Vector fell 1.3% to $3.70, but Contact Energy gained 0.8% to $8.01

Independent treasury adviser, Peter Cavanaugh, said the NZ and Australian dollars have held up well in the aftermath of Russia’s invasion of Ukraine compared to northern hemisphere currencies.

The kiwi and Aussie dollars have both risen almost 2.5% against the US dollar in the past month.

Cavanaugh said the kiwi dollar was likely to be supported while the Russia-Ukraine conflict continues and commodity prices were high.

Tags: Market Close

« NZ shares stabilise as buyers bag bargainsInflation hacks share prices »

Special Offers

Comments from our readers

No comments yet

Sign In to add your comment

© Copyright 1997-2022 Tarawera Publishing Ltd. All Rights Reserved