NZ market starts to see pick-up in volume
New Zealand’s market jumped up today thanks to US stocks having a good rally overnight and it was the second day this week for NZ’s index to have a better than below average turnover, after over a week of very low volume traded.
Thursday, September 8th 2022, 6:04PM
by BusinessDesk
The S&P/NZX 50 Index jumped 129.6 points, or 1.1%, to 11,677.93. Turnover was $116 million.
Medicinal cannabis company Cannasouth was down 4.1% to 35 cents. The company told the NZX today that its rights offer had closed with $1.5m raised and with over 5 million new shares being taken up by eligible shareholders.
Other cannabis stocks on the index had a better day. Rua Bioscience was up 3.6% to 29 cents on very light volume and Greenfern Industries shares were flat at 15 cents per share on light trading as well.
Yesterday, the global dairy trade (GDT) revealed that strong demand had driven an almost 5% increase to the index, the first time the index has risen in several consecutive auctions.
Whole milk powder (WMP) – which has the biggest influence on Fonterra's farmgate milk price – gained 5.1% to an average of US$3,610 (NZ$5,964) per metric tonne (MT).
ASB economist Nathaniel Keall said yesterday that the most “astonishing” gains had come from milk fats which jumped up over 13%.
“We’ve long said we expected prices would head higher over the spring as buyers came to realise how constrained the production outlook is,” he wrote in a Fonterra milk price forecast update.
“We’re sticking to our $10 per kgMS farmgate milk price for the 22/23 season. It’s still relatively early days, but for now, the season is shaping up as we’ve predicted.”
Today, Fonterra Shareholders’ Fund Units were up 1% to $3. Dairy manufacturer A2 Milk also rose 1% to $6.24 and infant formula manufacturer Synlait Milk edged up by 0.3% to $3.46.
Today, agricultural financial services company Rabobank said that a weaker tone had set into the global dairy market during the second half of 2022 and was reflected in the broad-based softening of Oceania dairy commodity prices.
Senior agricultural analyst Emma Higgins said milk production “across the export engine” wasn’t yet running on all cylinders and any growth would be modest.
“Farmgate milk prices are elevated in the Big-7 export regions, but high production costs, weather risks and emerging feed shortages will help keep the global milk supply response in check,” she said.
SkyCity Entertainment rose 1.8% to $2.79 today after weighing the market down yesterday and Restaurant Brands also jumped after the company's shares fell yesterday on the announcement that its group chief executive officer Russel Creedy and chief financial officer Grant Ellis will be retiring in 2023.
Restaurant Brands was up 1.1% to $8.14 by early evening.
Kiwi Property Group shares declined 0.5% to $1.01 for a second day, after the investment company announced yesterday that it had agreed to sell its Northlands Shopping Centre as well as 43 Langdons Road in Christchurch to Mackersy Property for $160m.
The NZ dollar sank further against the greenback yesterday – falling as low as 59.97 US cents – but over the course of today, managed to regain some ground.
The Kiwibank financial team described Wednesday as a “bumpy ride for currencies” in a note this morning and said the kiwi’s fall was due to poor data out of China that had “exacerbated” fears around how bad a looming recession could get.
The NZ dollar was trading at 60.52 US cents at 5pm in Wellington, up from 60.15 cents yesterday.
| « NZ shares falter as US economy charges forward | Fonterra's 'significant' upgrade happy surprise for NZ's market » |
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