Investors cheered by Briscoe's optimism for rest of the year
Briscoe Group’s optimism about the second half of the year brought investors through the doors while A2 Milk continued to benefit from speculation it's about to get a green light to send baby formula to the United States.
Thursday, August 4th 2022, 6:00PM
by BusinessDesk
Briscoe Group edged up 0.2% to $5.61 after the retailer said it would report a 4% decline in first-half profit from the prior period's $47.5 million. However, managing director Rod Duke said he was optimistic about the second half of the financial year and said the company should still be able to beat last year's record net profit of $87.9m.
Other retailers were mixed. Hallenstein Glasson rose 0.2% to $5.35 while KMD Brands fell 1.8% to $1.09 and Warehouse Group declined 0.9% to $3.42, while hospitality operators Savor was unchanged 45 cents and Good Spirits Hospitality rose 2% to 5.2 cents.
A2 Milk extended its gains, up 2% at $5.58. Earlier this week, A2 noted media speculation that it was nearing approval from the US Food and Drug Administration but said its application to sell infant formula in the US was still being reviewed.
Both A2 Milk and Fonterra submitted their application in late May. Neither has been approved to date. Fonterra Shareholders' Fund units were unchanged at $2.95.
Fletcher Building edged up 0.2% to $5.29. Earlier a draft report from the Commerce Commission stopped short of laying any sort of blame for high building prices at the door of dominant building players like Fletcher Building.
Jarden analysts said the report’s findings and recommendations are “very benign”, with little impact on Fletcher Building.
Among other building products firms, Steel & Tube was unchanged at $1.35 and Vulcan Steel advanced 0.4% to $10.09.
The wider market was again buoyed by companies offering reliable dividends, as the prospect of less aggressive interest rate hikes raised the allure of so-called yield stocks.
Ryman Healthcare rose 3.3% to $9.66, Mercury NZ was up 2.7% at $6.47, and Genesis Energy advanced 2.1% to $2.96.
Yesterday’s slightly higher unemployment rate added to the view that the central bank may not lift rates as high as expected, with several banks lowering mortgage rates over the past few days. Lower mortgage rates may help shore up the housing market, which has been under pressure of late. Ryman benefits as people look to sell their homes when they plan to move into a retirement village.
The S&P/NZX 50 index gained 30.44 points, or 0.3%, to 11,735.47. Turnover on the main board was modest at $140.4m.
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“It’s nice to see markets getting a bit of life back in general,” said Forsyth Barr broker Suzanne Kinnaird.
She noted that a positive offshore lead set the tone.
The Dow Jones Industrial Average added 1.3% overnight while the Nasdaq was up 2.6%.
Locally, the biggest volume went through tech stock PushPay Holdings with more than 4m shares changing hands, which may have been cheered by the lift on the Nasdaq.
The digital payment service for churches business rose 0.8% to $1.30.
Plexure, meanwhile, saw some profit taking after it gained strongly on news McDonald's has renewed its contract with the company to use its digital customer engagement platform for the next five years.
It shed 10% to close at 36 cents.
Third Age Health continued to recover, rising 4.9% to $2.15. Earlier it announced it had entered into a conditional contract to purchase a majority interest in a medium-sized general practice, based in Auckland.
Bremworth shed 5.4% to 53 cents. Earlier this week, Godfrey Hirst confirmed it had removed claims for damages in its high court case against Bremworth but didn’t back down on its accusation that it is greenwashing.
Godfrey Hirst, owned by US-based Mohawk Industries, has accused Bremworth of making false, misleading and unsubstantiated claims regarding the environmental impact of synthetic carpet in marketing material.
Exporter Fisher & Paykel Healthcare shed 2.5% to $20.96 as the kiwi dollar crept back up.
The NZ dollar was trading at 62.91 US cents at 4:30 pm in Wellington, down from 62.55 cents Tuesday.
Port of Tauranga posted the biggest decline on the NZX50, falling 2.6% to $7.01.
| « Higher unemployment spurs interest in NZX50 | NZ market looks to be in better heart » |
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