A2 and Z Energy lead shares down
New Zealand shares dropped, led lower by a2 Milk Co and Z Energy, while Trustpower and Summerset gained.
The S&P/NZX50 index fell 28.5 points, or 0.3 per cent, to 8917.59. Within the index, 23 stocks rose, 19 fell and eight were unchanged. Turnover was $90.1 million.
“There’s very light turnover but again our index is being led down by a2, Z, Synlait and Port of Tauranga,” said Peter McIntyre, investment adviser at Craigs Investment Partners. “A2 makes up a good chunk of the index, and if it is having a weaker day it has an impact on the index as a whole.”
A2 led the index lower, down 2.4 per cent to $10.75.
“It has been priced to perfection and a number of investors are thinking perhaps they’ll take a bit off the top. It really follows what happens in Australia as well where it is down too,” McIntyre said.
Z fell 1.8 per cent to $7.17. On Wednesday, the country’s biggest fuel retailer cut full-year earnings guidance by $30m due to an extended shutdown at the Marsden Point oil refinery and high crude prices in the June quarter.
It is now forecasting operating earnings of $420m to $455m for the year through March 2019, down from previous guidance of $450m to $485m in earnings before interest, tax, depreciation and changes in financial instruments.
“Even though that downgrade is mostly one-off in nature, you have seen retail pump prices increase with the extra taxes,” McIntyre said. “We’ve seen a bit of a pricing shock and volumes are back to a declining trend,” he said.
Goodman Property Trust dropped 1.7 per cent to $1.46, Pushpay Holdings fell 1.7 per cent to $4.18, and
Synlait Milk declined 1.4 per cent to $10.70. Port of Tauranga dipped 1.2 per cent to $5.01. Trustpower was the best performer, up 2.1 per cent to $5.77. The company gave an investor day presentation on Tuesday which McIntyre said has been very warmly received by market, due to the company saying there was potential for it to continue with special dividends.
“It’s been well supported by income investors because it will end up being one of the higher-yielding electricity stocks on the market, and when interest rates are low, investors are seeking yields,” McIntyre said.
Summerset gained 1.7 per cent to $7.80, Australia and New Zealand Banking Group rose 1.6 per cent to $32.06 and Kathmandu Holdings advanced 1.6 per cent to $3.16.
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