Market commentary

NEW Zealand shares rose for a second day as a strong rally on Wall Street brought out investors on the prowl for bargains.

The S&P/NZX 50 Index advanced 155.23 points, or 1.7% to 9264.38. Within the index, 46 stocks rose, and four fell. Turnover was $261 million.

Equity markets around the world were buoyed by the prospect of a $US2 trillion stimulus package getting through deep divisions among US policymakers. The Dow Jones Industrial Average rose 11% overnight, and across Asia, Japan’s Topix was up 4.6% in afternoon trading, Hong Kong’s Hang Seng rose 2.1% and Korea’s Kospi 200 Index rose 4.1%.

New Zealand’s benchmark index started the day strongly, having climbed 7.2% yesterday as investors were buoyed by the government’s domestic support package.

Companies that have been the most beaten up were among today’s strongest performers.

Sky Network Television, which has been trading near all time lows, jumped 34.2% to 25.5 cents. The payTV operator yesterday said it had been deemed an essential service.

Tourism Holdings, which suspended dividend payments and ditched earnings guidance due to the virus, climbed 20.6% to 88 cents.

Retirement village operators have also been sold off as investors question whether the covid19 outbreak will hit their residents more harshly than the wider population.

Metlifecare, which is under a takeover offer, rose 16.4% to $4.83, Summerset Group climbed 15.7% to $4.522, Arvida Group was up 13% at $1.13, and Ryman Healthcare advanced 11.9% to $9.20. Oceania Healthcare gained 10.6% at 52 cents.

Air New Zealand was the most traded stock at 10.2 million shares, compared with its 90day average of 1.6 million. The stock rose 3% to 87 cents. Auckland International Airport rose 10.3% to $5.45.

Among other NZX50 firms deemed essential services, Contact Energy rose 3.5% to $5.26, Scales climbed 11.3% to $4.03, and Sanford was up 6.7% to $6.05.

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For the first time since the coronavirus crisis began, Australian shares gained for two straight days, rallying in the final minutes of trade yesterday on reports United States politicians had reached a deal on a massive US stimulus deal to shore up the world’s biggest economy.

The S&P/ASX200 powered almost 6% in early trade, faded before noon and then gained 153 points in the last 15 minutes of the day to close up 262.4 points, or 5.54%, to 4998.1

The All Ordinaries index finished 252.9 points, or 5.32%, higher at 5006.2.