Market commentaries

WELLINGTON: New Zealand shares fell as a sharp drop in oil prices and doubts about the prospects for ChinaUS talks weighed on sentiment in Asian markets.

The S&P/NZX 50 index fell 33.78 points, or 0.4%, to 8,827.74. Within the index, 22 stocks fell, seven were unchanged and 21 rose. Turnover was $130 million.

US stocks fell for a third day as the drop in oil prices hit some of the country’s major industrial firms and mixed signals on the pending USChina trade talks spooked investors.

The Dow Jones Industrial Average fell 0.4%, while the S&P 500 Index was down 0.2%. In Australia the S&P/ASX 200 index was recently down 1.6%, led by oil producers and other resource plays.

Greg Smith, head of research at Fat Prophets, said the bounce global equity markets enjoyed earlier this month has proven ‘‘shortlived’’ and investors are likely to be more wary ahead of the USChina trade talks at the G20 summit in Argentina.

The biggest gainer in the local benchmark yesterday was global logistics firm Mainfreight, which rose 5.2% to $30.25. The firm yesterday reported a betterthanexpected 32% increase in firsthalf profit to $55.7 million.

Mr Smith said the strong performance of Mainfreight’s international business was heartening, and noted that investors will still reward companies that deliver good results.

Generator Meridian Energy was the heaviest traded stock with almost 3 million shares changing hands. It rose 0.5% to $3.235, after high wholesale power prices last month pushed its average New Zealand generation price for the four months through October almost 50% higher at $124.50/MWh. Generation volumes in the same period were 16% higher, while retail volumes rose 2.9%.

Genesis Energy rose 1.6% to $2.55. Contact Energy rose 1.2% to $5.87.

Other big volume stocks yesterday included Precinct Properties, down 0.4% at $1.425, with 2.7 million shares traded; Kiwi Property Group, up 1.1% at $1.35, with almost 2.6 million shares traded; and Spark New Zealand, up 0.7% at $4.14, with more than 1.8 million shares traded.

Among the bigger local decliners were some of the highergrowth ‘‘market darlings’’, Mr Smith said. Stocks with a heavy investor base in Australia also suffered with the weaker sentiment in that market.

A2 Milk Co fell 2.8% to $10.01, Westpac Banking Corp 2.4% to $27.40, and Fisher & Paykel Healthcare 1.8% to $13.45.

Freightways led the declines, falling 6.2% to $6.81. More than 430,000 shares changed hands, about three times the daily average of the past three months.

Chorus fell 2% to $4.92. The telecommunications network operator announced plans to reduce the wholesale price of its gigabit residential fibre product in mid2019 and again in mid2020. Volume of 243,000 was about half the daily average.

Infratil, which yesterday reported a 19% increase in halfyear operating earnings and raised its fullyear forecast, rose 0.7% to $3.51.

The Australian sharemarket has lost more than 1.5% for the second consecutive day with commodityrelated stocks suffering heavy losses on plunging oil prices.

The benchmark S&P/ASX200 index closed 101.4 points lower, or 1.74%, at 5732.8, while the broader All Ordinaries was down 1.69%.

CommSec market analyst James Tao said there was no smoking gun to explain the dramatic broadbased selloff, as the local bourse’s loss compared to other markets was a concern.

Energy stocks dragged on Wall Street overnight after US oil futures closed down for a record 12th straight session to the lowest level since November 2017, falling 7.1%.

The local energy sector followed suit to plunge more than 2.5% with Santos taking the biggest hit, losing 5% to close at $6.06. — BusinessDesk/AAP