Market commentary
WELLINGTON: They were impressive figures. Nearly $1.3 billion worth of Contact and Meridian Energy shares were traded with the offshore exchange traded funds rebalancing their weightings, but it did not unnerve the New Zealand sharemarket.
The S&P/NZX 50 Index gained 48.18 points or 0.38% to 12,684.73 — as the global markets show more confidence and are steadily moving upwards. On Wall Street, the Dow Jones Industrial Average broke through the 34,000 points mark for the first time.
On the local market, there were 72 gainers and 61 decliners and volume soared to an unprecedented level of 242.22 million share transactions worth $1.45 billion because of the iShares Global Clean Energy Exchange Traded Funds (ETFs) selling activity.
Contact and Meridian rose all week, defying predictions that their share prices would fall, as the two BlackRock iShares funds reduced their weightings in the renewable energy stocks from over 4% to just under 1%. The S&P global index the funds track are adding 51 new constituents.
Contact closed at $7.68, up 18c or 2.4%, with 81.48 million shares worth $626.12 million changing hands. Meridian was up 5c to $6.05 on trade of 106.42 million shares worth $644.51 million. More than 10% of Contact’s total shares and about 5% of
Meridian’s changed hands.
Sam Dickie, senior portfolio manager with Fisher Funds, said "we have seen a collapse in volatility in the markets and now they are very relaxed about economic recovery and getting out of the Covid woods’’.
Fisher and Paykel Healthcare had a strong day, rising 81c or 2.48% to $33.50; Ebos Group was up 33c to $30.28; Fletcher Building gained 14c or 1.99% to $7.18; Z Energy climbed 6c or 2.32% to $2.65; and SkyCity Entertainment picked up 4c to $3.45.
Napier Port rose 10c or 29% to $3.55 after upgrading its fullyear operating earnings forecast to $39 million$42 million, from the previous $34 million$38 million because of solid demand from Hawke’s Bay fruit and fibre exports. Bulk trade for the six months ending March increased 17.1%, including 20.6% surge in log trade, and container volumes remained steady.
Auckland International Airport fell 12c or 1.6% to $7.38 but its latest statistics showed increased activity. Total passenger volumes in March decreased 53.8% compared to last year, but it was an improvement on February when they fell 71%.
Other decliners were Mainfreight, down $1.21 or 1.73% to $68.54; a2 Milk losing 8c to $8.83; Ryman Healthcare declining 18c to $14.47; Restaurant Brands falling 15c to $13; and Vector shedding 6c to $4.05.
Overnight, the Dow Jones Industrial Average climbed over the 34,000 mark for the first time, spurred on by improving economic data — US retail sales surged 10% in March thanks to the $US1400 ($NZ1955) government stimulus cheque, and unemployment claims fell to a fresh low for the Covid pandemic period.
The Dow Jones rose 305 points or 0.9% to a new high of 34,035.99 and the S&P 500 Index also struck a record close, for the 22nd time this year, increasing 1.11% to 4170.42. The Nasdaq Composite surged 1.13% to 14,038.76, just short of its February record. —