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The Markets

Offshore sentiment drives local market

The fight against inflation is far from over. Global sharemarkets, including New Zealand’s, sold off sharply after the United States Federal Reserve indicated interest rates may need to go higher for longer.

Wednesday, March 8th 2023, 6:43PM

by BusinessDesk

Following offshore leads, the S&P/NZX 50 Index fell at the opening and then traded steadily to close at 11,855.54, down 64.02 points or 0.54%. 

There were 60 gainers and 76 decliners on the main board with 24 million shares worth $117.14m changing hands. 

US Federal Reserve chair Jerome Powell told the Senate banking, housing and urban affairs committee that recent economic data had come in stronger than expected and the ultimate level of interest rates is likely to be higher than previously anticipated. 

“If the totality of the data were to indicate that faster tightening is warranted, we would be prepared to increase the pace of rate hikes,” Powell said. 

His statement immediately sent Wall Street into a spin and analysts were now predicting a 50 basis points increase in rates when the Federal Reserve meets in a fortnight.

The Fed raised rates by 25 basis points at its February meeting.  The Dow Jones Industrial Average fell 574 points or 1.72 % to 32,856.46 points; the S&P 500 declined 1.53% to 3986.37; and the Nasdsaq Composite was down 1.25% to 11,530.33. 

The sell-off brought Dow Jones into negative territory this year, down 0.88%, while the S&P is up 3.83% and the Nasdaq up 10.16%. 

The Australian S&P/ASX 200 Index had fallen 0.83% to 7303.8 points at 6pm NZ time, and the Hong Kong Hang Seng Index was down 2.33% to 20,056.04. 

Jeremy Sullivan, investment advisor with Hamilton Hindin Greene, said offshore sentiment drove the local market. 

“Powell basically said US employment data was too strong, inflation was too persistent and the terminal cash rate may need to be higher – so interest rate expectation ticked up again. 

“New Zealand still has its inflationary pressures,” Sullivan said. “Seek has more job openings, indicating more employers are hiring than firing and the labour market remains tight. Cyclone Gabrielle will be inflationary, with insurance money coming into circulation.” 

Pushpay Holdings was up a further 5c or 4.07% to $1.28 after announcing that the Sixth Street and BGH Capital consortium is exploring a potential alternative takeover proposal and the deadline to call another shareholders’ meeting has been extended to next Monday. 

Otherwise, either party can terminate the scheme implementation arrangement that saw the consortium bidding to take over Pushpay at $1.34 a share. 

Sullivan said there is potential for a higher takeover offer with fingers crossed that shareholders do get a higher price out of it. 

Ebos Group gained 25c to $45.25 on trade worth $23.4m and Freightways increased 12c to $9.69, but they received little support. 

Market leader Fisher and Paykel Healthcare was down 7c to $26.08; Mainfreight shed $1.30 or 1.77% to $72.20, a2 Milk decreased 6c to $7.34; Auckland International Airport was down 7c to $8.61; Fletcher Building gave up 9c or 1.9% to $4.65; and Spark declined 6.5c to $4.955. 

In the energy sector, Meridian declined 7.5c to $5.18; Mercury was down 6c to $6.42; and Manawa gained 9c or 1.84% to $4.98. Infratil decreased 15c or 1.72% to $8.55. 

Ryman Healthcare was down 15c or 2.68% to $5.44 as its retail rights offer came to an end. Ryman raised $237m, with 66% of retail shareholders taking up the offer at $5 a share, and it went into a trading halt until Friday while it completed a bookbuild on the shortfall of 25 million new shares. 

Ventia Services fell 11c or 4.28% to $2.46; Goodman Property Trust was down 5c or 2.36% to $2.07; AFT Pharmaceuticals decreased 11c or 2.93% to $3.64; and Bremworth declined 2.5c or 6.25% to 37.5c. 

Geneva Finance decreased 2c or 4.88% to 39c; Seeka declined 5c to $2.95; Cooks Coffee was down 1.5c or 4.41% to 32.5c; and My Food Bag slipped a further 1.5c or 5.77% to 24.5c. 

Napier Port rebounded 15c or 5.56% to $2.85; Port of Tauranga was up 5c to $6.25; and Marsden Maritime Holdings was down 10c or 1.79% to $5.50. Move Logistics decreased 2c or 1.87% to $1.05. 

Among the gainers, MHM Automation was up 4c or 4.65% to 90c; Rakon added 3c or 3.26% to 95c; Briscoe Group collected 9c or 1.93% to $4.76; The Warehouse Group was up 4c to $2.57; Sanford improved 9c or 2.27% to $4.06; and Synlait Milk increased 7c or 2.15% to $3.33. 

TruScreen, gaining 0.001c or 3.13% to 3.3c, has received an order of 40 cervical cancer screening devices from its China distributor Beijing Siweixiantai Tech Co, for installation into the public health check sector.

Tags: Market Close

« Turners goes up a gear as NZ market remains flat‘Listless and almost asleep’: NZ’s market waits for US jobs data »

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AIA - Back My Build 6.19 - - -
AIA - Go Home Loans 8.74 7.45 7.05 6.85
ANZ 8.64 7.99 7.49 7.35
ANZ Blueprint to Build 7.39 - - -
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BNZ - Green Home Loan top-ups - - - 1.00
BNZ - Mortgage One 8.69 - - -
BNZ - Rapid Repay 8.69 - - -
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BNZ - TotalMoney 8.69 - - -
CFML Loans 9.45 - - -
China Construction Bank - 7.09 6.75 6.49
China Construction Bank Special - - - -
Co-operative Bank - First Home Special - ▼7.09 - -
Co-operative Bank - Owner Occ 8.40 ▼7.29 6.89 6.75
Lender Flt 1yr 2yr 3yr
Co-operative Bank - Standard 8.40 ▼7.79 7.39 7.25
Credit Union Auckland 7.70 - - -
First Credit Union Special - 7.45 7.35 -
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Heartland Bank - Reverse Mortgage - - - -
Heretaunga Building Society 8.90 7.60 7.40 -
HSBC Premier 8.59 - - -
HSBC Premier LVR > 80% - - - -
HSBC Special - - - -
ICBC 7.85 7.05 6.85 6.59
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Kainga Ora - First Home Buyer Special - - - -
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Resimac - LVR < 80% 8.84 8.30 7.89 7.69
Lender Flt 1yr 2yr 3yr
Resimac - LVR < 90% 9.84 9.30 8.89 8.69
Resimac - Specialist Clear (Alt Doc) - - 8.99 -
Resimac - Specialist Clear (Full Doc) - - 9.49 -
SBS Bank 8.74 7.95 7.45 7.29
SBS Bank Special - 7.45 6.95 6.79
SBS Construction lending for FHB - - - -
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TSB Bank 9.44 8.19 7.55 7.55
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TSB Special 8.64 7.39 6.75 6.75
Unity 8.64 6.99 6.85 -
Unity First Home Buyer special - - 6.45 -
Wairarapa Building Society 8.60 7.15 6.85 -
Westpac 8.64 7.89 7.49 7.25
Westpac Choices Everyday 8.74 - - -
Westpac Offset 8.64 - - -
Westpac Special - 7.29 6.89 6.65
Median 8.64 7.45 7.37 6.77

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