Sharemarket follows Wall St with gains
NZX joins global rally as A2 Milk hits new high and Fletcher lifts off 12-month low
New Zealand shares rose, joining a global rally, with A2 Milk up after raising its full-year revenue guidance, Fletcher Building and Tegel Group climbing from their recent lows and Spark rising on demand for its attractive yield.
The S&P/NZX 50 Index gained 112.2 points, or 1.6 per cent, to 7335.14. Within the index, 33 stocks gained, 14 fell and three were unchanged. Turnover was $272 million, including $122m in Spark shares.
Shares rose on Wall Street, with the Nasdaq Composite Index reaching a record high, and key equity benchmarks rose across Asia yesterday as investors responded to what’s seen as a market-friendly presidential election outcome in France and US President Donald Trump’s imminent announcement on corporate tax cuts.
“There’s a risk-on feel to it,” said Greg Smith, head of research at Fat Prophets in Auckland.
led the index higher, rising 7.8 per cent to a record $3.45 after the milk marketer forecast revenue of $525m in the year ending June 30, up from $352.8m a year earlier. A2 generated sales of $388m in the nine months ended March 31, with thirdquarter sales of its infant formula, popular in China where rules have been tightened for internet sales, exceeding expectations.
“The changes we saw in China — it’s all about rationing the number of brands available and improving the quality,” Smith said. “A2 shouldn’t be too scared if they are one of the brands.”
A2 Milk Fletcher Building
gained 3.8 per cent to $8.31, having sunk to a 12-month low last week on the back of an earnings downgrade. whose shares have been punished in
Tegel,
the face of a glut of product and rivalry from Australia’s Ingham’s, gained 2.6 per cent to $1.17.
Tegel and Inghams are facing pricing pressure in the face of the glut and in a lot of supermarket chains overseas chicken is used as a loss leader. “Just because it has fallen doesn’t necessarily make it cheap,” he said.
Spark
rose 1.8 per cent to $3.675 and Smith said it may be a beneficiary of Australian investors deeming that market as becoming overcrowded with telcos and being drawn to its yield of more than 6 per cent. It has also benefited from the regulator nixing Sky Network Television’s proposed tie-up with Vodafone New Zealand.
Sky TV Group Xero
fell 0.3 per cent to $3.83 yesterday.
Among other stocks, rose 4.7 per cent to $18.90.
rose 2.4 per cent to $6.84 after figures showed net inbound migration remained at record levels while short-term visitor arrivals chalked up another annual record, although there was a dip in March from the same month last year.
International Airport Ebos Group Auckland Australia & New Zealand Banking Group Westpac Banking Corp
gained 2.6 per cent to $35.12 and rose 1.9 per cent to $37.77.
Fisher & Paykel Healthcare Summerset
rose 2.3 per cent to $9.82, gained 2 per cent to $5.29 and rose 1.8 per cent to $20.85. showed consumer prices rose slightly less than expected in the first quarter in Australia. But it pared those gains. Borkin said it underscored the two economies are at different points in the cycle. Given there are signs of inflation emerging in NZ, Borkin said he expected the central bank to lift rates here before the Reserve Bank of Australia does. As a result, a rebound toward the mid-90s may be on the cards, he said. The kiwi dropped to A92.06c versus A92.46c late on Tuesday. The New Zealand dollar fell to €63.28c from €64.30c, 53.94 British pence from 54.64p, ¥77.05 from ¥77.16, and 4.7674 yuan from 4.8085 yuan.