Market commentaries

WELLINGTON: New Zealand shares fell on the last day of the month as investors continued to bank profits from outperforming stocks and large fund managers tweaked their portfolios in preparation for May.

The S&P/NZX 50 Index fell 134.12 points, or 1.3%, to 10,532.07. Within the index, 20 stocks declined, 23 rose, and seven were unchanged. Turnover was $248.3 million.

Blue chip companies including Meridian Energy, Spark New Zealand and Ryman Healthcare led the market lower as investors took the end of month as an opportunity to ‘‘lock in some profits’’ and review their portfolios, Milford Asset Management portfolio manager Sam Trethewey said.

‘‘We’ve seen some profittaking across several of the large cap names following a strong month, where investors have been willing to look through some of the shorterterm headwinds from covid and focus on the mediumterm value,’’ he said.

The NZX50 is up 7.9 across the month, rallying as investors grow increasingly optimistic that the outbreak has plateaued. The number of new virus cases has fallen steadily since Easter; just three new local cases were reported yesterday.

ANZ senior economist Liz Kendall noted that eliminating the virus would give New Zealand a mediumterm economic advantage over countries facing a second wave of the outbreak. However, she warned, economic damage had already been done.

‘‘We are more cautious about the outlook than equity markets are currently pricing,’’ she wrote in a note. ‘‘In time, we expect that firms’ difficulties will become clearer and this will see a repricing of risk in markets.’’

Business confidence plunged to unprecedented lows in April, with half the firms surveyed expecting to cut staff.

Central bank stimulus had provided support to equity markets and investors were moving to cash in on the recovery, Mr Trethewey said.

Meridian led the market lower, falling 5.5% to $4.49 as investors took advantage of the stock’s strong recovery. Even after yesterday’s decline the share price is up 11.1% across the month.

Spark fell 3.9% to $4.44, Ryman was down 3.1% at $12.11, Fisher & Paykel Healthcare declined 2.4% to $27.39 and a2 Milk Co decreased 1.7% to $19.63.

Investore Property fell when trading resumed yesterday, following the completion of its $85 million placement at $1.65 a share. An additional $15 million will be available to existing shareholders at a further discount. The shares fell 3.4% to $1.71.

Mr Trethewey said the capital raising had driven some weakness in other property stocks over the past two days as they were sold off to redirect funds into the Investore offer.

Some continued this decline: Goodman Property Trust was down 2.2% at $2.255 and Property For Industry fell 0.5% to $2.17. Others held steady: Kiwi Property Group at 96.5 cents, Argosy Property at $1.06 and Precinct Properties at $1.59.

Fletcher Building rose 0.3% to $3.70. An analyst note by Craigs Investment Partners said the impact of the pandemic on Fletcher would not be as severe as that of the Global Financial Crisis.

Australia & New Zealand Banking Group rose 1.8% to $17.92 after reporting a 51% drop in firsthalf profit, due largely to a $A1.03 billion ($NZ1.1 billion) provisioning charge for Covid19related bad debt. However, investors took confidence following a successful capital raising from National Australia Bank. Westpac Banking Corp also rose 2.8% to $17.20. Stock market operator NZX rose 1.6% to $1.28 after it reported an 18% increase in firstquarter revenue.

Auckland International Airport rose 1.7% to $6.09 after saying its $200 million share purchase plan was oversubscribed, receiving about $489 million of applications. The airport operator raised $1.2 billion through the plan and a placement at $4.66 a share.

SkyCity Entertainment Group posted the day’s biggest gain, up 6.8% at $2.66.

The Australian sharemarket has followed up its worst month ever in March with its best month ever in April — and it finished with a bang.

The S&P/ASX200 benchmark index rallied yesterday for its best day in three weeks, closing up 129 points, or 2.39%, to close at 5522.4 points, its best level since March 13. The broader All Ordinaries index gained 133.9 points, or 2.45%, at 5597.7 points. One Australian dollar was buying 65.57 US cents. — BusinessDesk/AAP