NZ sharemarket bounces back 0.5% on Middle East hopes
The New Zealand sharemarket posted a solid 0.5% gain, joining other regional sharemarkets in bouncing back as tension between Iran and Israel appeared to ease.
Monday, April 22nd 2024, 6:23PM
by BusinessDesk
The S&P/NZX 50 Index turned around at lunchtime after reaching a morning low of 11,731.04 and closed at 11,852.8, up 56.58 points or 0.48%.
There were 73 gainers and 65 decliners over the whole market on light trading of 21.31 million share transactions worth $67.84m.
Jeremy Sullivan, investment adviser with Hamilton Hindin Greene, said the local market opened weaker following “some frosty valuations in the US technology sector” and then recovered after Iran made a clarification of the Israel counterattack.
“There’s been a slight de-escalation of the Middle East situation,” he said. “Iran commented that its nuclear facilities remained unscathed and the Israeli retaliation was not large-scale.”
The Australian S&P/ASX 200 Index had increased 0.94% to 7,638.7 points at 6pm NZ time; the Hong Kong Hang Seng had risen 2.13% to 16,570.45; and the Japanese Nikkei 225 was up 0.52% to 37,260.99.
On the eve of reporting from the big US tech stocks, the Nasdaq Composite fell 2.05% to 15,282.01 points, and the S&P 500, heading for its biggest monthly drop since December 2022, was down 0.88% to 4,967.23 at the weekend (NZ time).
Chipmaker Nvidia declined 10% to US$762 (NZ$1,289.28), and Netflix was down 9.09% to US$555.04.
At home, ASB Bank is now expecting the first official cash rate cut in February rather than in November as previously thought. The bank said financial markets have been getting stung both here and elsewhere by the stubborn tail-end of (NZ and global) inflation pressures.
Although 4% headline inflation, following the release of the March quarter consumers price index, was in line with expectations, it was the mix of inflation that surprised and was significant.
Local market
Ryman Healthcare was down 2c to an 11-year low of $4.32 following the sudden departure of chief executive Richard Umbers. Dean Hamilton will become the executive chair while a new chief executive is appointed. Ryman reaffirmed its full-year underlying profit guidance of $265m-$285m.
Sullivan said it’s never comforting “when you see a chief executive leave so quickly, and there must have been some unsettled conversations at the board level about Ryman’s performance.”
He suggested that a further capital raise may be in the offing as Ryman is building faster than it is generating cash at present. Ryman raised $902m on the market in February last year.
Fletcher Building was up 11c or 2.85% to $3.97; Chorus rebounded 19c or 2.62% to $7.43; Auckland International Airport gained 12c to $7.97; Spark added 6.5c to $4.715; and Freightways increased 14c to $8.74.
Heartland Group added 3c or 2.91% to $1.06; Michael Hill rose 3c or 4.48% to 70c; Channel Infrastructure gained 3c or 1.99% to $1.54; Restaurant Brands collected 11c or 3.24% to $3.50; SkyCity improved 4c or 2.2% to $1.86;
Genesis Energy, up 1c to $2.35, reported that electricity sales were up 6.4% or 80GWh to 1,336GWh in the third quarter, and new customers increased 1,537, bringing the total to 494,752.
Vector, down 2c to $3.70, told the market that connections (electricity and gas) increased 7.9% for the nine months ending March and 2% for the year. Electricity distributed volume for the nine months was up 3.2%, and gas was down 4%.
Air NZ was unchanged at 57c after downgrading its full-year gross earnings to $190m-$230m, from $200m-$240m, because of “softening in revenue conditions” over the fourth quarter, both domestically and in the North American market.
Port of Tauranga was down 9c or 1.83% to $4.83; Scott Technology declined 8c or 2.82% to $2.76; Synlait fell a further 3c or 5.56% to 51c; Gentrack declined 19c or 2.32% to $8; and Oceania Healthcare eased 3c or 3.1% to 61c.
Auto retailer 2 Cheap Cars, unchanged at 82c, announced David Sena is taking over as chief executive following the resignation of Paul Millward. Sena and his family trust has a 76% shareholding in the company.
Radius Residential Care gained 0.006c or 5.26% to 12c after reporting that 12-month operating earnings (Ebitda) rose 48% to $21m compared with the previous year. Radius, which has no short-term debt, is paying a final dividend of 0.7c a share.
| « NZ sharemarket down 1.13% for the week | NZ sharemarket down after yesterday's gain » |
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