Market commentary
WELLINGTON: Another vaccine breakthrough energised the Covid19sensitive stocks on the New Zealand sharemarket for the second time in just over a week and flattened Fisher & Paykel Healthcare.
American drug maker Moderna announced the phase 3 clinical trial for its vaccine was 94.5% effective against Covid19. But there was not the same flurry locally following Pfizer’s announcement last week as trading rotated to stocks that will benefit from a vaccine and the reopening of borders.
The S&P/NZX 50 Index had a slight gain, edging ahead 20.11 points, or 0.16%, to 12,765.03.
There were 75 gainers and 61 decliners over the whole market, and trading was heavy, with 56.64 million shares worth $231.82 million changing hands.
‘‘It’s always the way — the first time you hear about a Covid breakthrough it’s a shocking development and then when another comes along you take it in your stride,’’ Fisher Funds senior portfolio manager Sam Dickie said.
‘‘What you saw today is the mechanics of the market. The heavyweights that dominate the market and are seen as beneficiaries of Covid dragged the overall index down and buying flowed to stocks that will benefit from a vaccine,’’ he said yesterday.
Fisher & Paykel Healthcare fell 40c to $34.20 on hefty trade worth $52 million. Mainfreight was down $1.35, or 2.25%, to $58.504; Chorus declined 25c, or 2.82%, to $8.60; and Meridian lost 22c, or 3.49%, to $6.08.
Among the Covid19sensitive stocks, Auckland International Airport climbed 14c, or 1.83%, to $7.78; Air New Zealand was up 4.5c, or 2.74%, to $1.69; Foley Wines increased 5c, or 2.65%, to $1.94; Tourism Holdings gained 2c to $2.65; and Vista Group edged ahead 1c to $1.70.
Fletcher Building, which recently surprised the market with an earnings upgrade, continued its strong run, rising 15c, or 2.75%, to $5.60. Serko was up 10c to $5.60, Z Energy gained 9c, or 2.83%, to $3.27, and a2 Milk rose 29c, or 1.9%, to $15.59.
Mobile marketing provider Plexure Group rose 11c, or 8.33%, to $1.43 after completing an oversubscribed placement of $32 million at a discounted price of $1.20 a share.
The cannabis stocks neared their listing price of 50c, Cannasouth falling 3c, or 5.26%, to 54c and Rua Bioscience down 2c, or 3.7%, to 52c.
Cannasouth is having Medicinal Cannabis Agency assessment of its first three white label products, which could be available to patients in the first half of next year.
Overnight on Wall St, the Dow Jones Industrial Average climbed 470 points, or 1.6%, to an all time high of 29,950.44 on the Moderna news. It was Dow Jones’ fastest rebound from a bearmarket low in nearly three decades, after hitting 18,591.93 on March 23.
Since the end of March, the Dow Jones has surged 60.5%, the S&P 500 Index nearly 62% and the technologydriven Nasdaq Composite more than 73%. As the Dow nears the psychological milestone of 30,000 points, it may confirm yet another bull market.— The New Zealand Herald