Smooth ride for markets despite shakes
New Zealand’s financial markets are taking the effects of Monday’s earthquake in their stride, analysts say.
The NZX 50 opened yesterday up 0.5 per cent, but lost ground and was down marginally by late morning. It closed up 0.48 per cent at 6770 points.
The New Zealand dollar continued to climb against the US dollar after trading at US70 cents on Monday. It had reached US71.2C by late yesterday morning.
Hamilton Hindin Greene investment adviser Jeremy Sullivan said the market had largely taken news of the earthquake in its stride.
Tower Insurance was down 7 per cent on Monday and announced it expected damage to cost it $7.2 million after tax before its reinsurance kicked in.
Sullivan said Mainfreight, Fliway and Freightways could see a boost once roads opened as a large amount of freight might be moved by truck rather than rail for some time.
‘‘Otherwise we are well insured as a nation and [the] Government [has] stated we have more than enough in reserve to cover any expenses over and above the reinsurance,’’ Sullivan said.
ASB chief economist Nick Tuffley said it was becoming increasingly likely the main financial impacts of the earthquake would relate to transport and logistics.
In the short term, there was likely to be some disruption to tourism as roads into Kaikoura were going to need a lot of repair and restoration.