Market commentaries
WELLINGTON: New Zealand shares rallied late in the trading session to follow Asian markets higher, led by exportfocused firms including Fisher & Paykel Healthcare and a2 Milk.
The S&P/NZX 50 index increased 23.08 points, or 0.3%, to 8745.59. Within the index, 18 stocks gained, 25 fell and seven were unchanged. Turnover was $132.3 million.
Stocks across Asia gained after China confirmed it would lower auto tariffs on US goods. The world’s two biggest economies are working to a 90day timeframe to find common ground and dial back tensions that have seen titfortat tariffs imposed on exports.
Exporters led gains on the domestic market with F&P Healthcare up 4.6% at $12.40 in average trading. A2 rose 1.9% to $10.95 on moderate volumes, while Scales Corp increased 1.2% to $4.32. National carrier Air New Zealand rose 2.3% to $3.09.
The late rally offset the negative tone for licensed lenders after the Reserve Bank’s proposals to make them hold more capital on their books. Heartland Group dropped 4.6% to $1.45 on heavierthanusual trading, while Australia & New Zealand Banking Group fell 2.9% to $25.76. Westpac Banking Corp was down 1.3% to $26.
Greg Smith, head of research at Fat Prophets, said imposing stricter capital requirements would result in increased lending rates as the banks passed on the costs to borrowers, and would probably dent economic growth.
‘‘The Australian and Australasian banks are among the strongest in the world,’’ he said. ‘‘None went bust in the GFC.’’
Spark New Zealand was the most traded stock on a slightly busier volume of 3.3 million shares. It fell 1.2% to $4.20. Kiwi Property Group rose 3% to $1.385 on 2.5 million shares, twice its 90day average. Meridian Energy increased 0.7% to $3.425 with 2.3 million shares traded.
Of other companies trading on volumes of 1 million shares or more, Trade Me was unchanged at $6.32, Auckland International Airport slipped 0.4% to $6.945, Contact Energy decreased 0.5% to $5.85 and Goodman Property Trust increased 1% to $1.57.
Sky Network Television fell 2% to $1.97, falling below $2 for the first time since it merged with Independent News Ltd in 2005.
Vital Healthcare Property Trust declined 0.7% to $2.075 before its annual meeting on Thursday. Rebel investors are seeking to diminish the control of the trust’s manager.
Mercury NZ decreased 0.6% to $3.53 after the company announced the sale of its Metrix smart metering business for $270 million. It will use some of the proceeds to repay debt.
TruScreen was unchanged at 18c in its first day of trading on the main board, having migrated from the NZAX.
The Australian sharemarket closed higher after an afternoon rally led by the materials sector.
The benchmark S&P/ASX200 index sat flat for much of the day but a push in the final three hours of trade meant it closed 56.3 points, or 1%, higher at 5658.3 points.
The broader All Ordinaries closed 54.1 points, or 0.95%, higher at 5732.9 points, while the Australian dollar was buying US71.73c at 1630 AEDT, from US71.93c on Friday.
The materials sector had been strongest throughout the day, propelled by the promise of capital returns to shareholders of mining giants BHP and Rio Tinto.
BHP closed 3.5% higher at $33.53 after announcing it would pay a $US1.02pershare special dividend in January, fulfilling its promise to return the money made from the sale of its onshore US shale assets.
Rio Tinto was not far behind, closing 2.2% higher at $76.17 after completing the $A500 million sale of its French aluminium smelter.
The afternoon surge, which came amid rumours of a budget surplusinspired splurge by federal government, lifted every major sector except the financials, which closed flat. — BusinessDesk/AAP
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