Fears over US rates push NZ shares lower
New Zealand shares slipped, joining a sell-off across Asia, as investors fret over the future track of US interest rates ahead of this week’s Federal Reserve policy review. Heartland Group sank on concerns over stricter banking capital requirements.
The S&P/NZX 50 index fell 57.22 points, or 0.7 per cent, to 8688.37. Within the index 29 stocks fell, 14 gained and seven were unchanged. Turnover was $160.1 million.
The Fed is expected to raise the federal funds rate a quarter point but investors are weighing up whether the track for future increases will be pared back.
“If you’re punching into an analyst’s model with regards to valuation, interests rates are quite key,” said Peter McIntyre, investment adviser at Craigs Investment Partners. “The market’s a little bit on edge.”
Heartland led the market lower, falling 6.9 per cent to $1.35, its lowest close since August 2016. The local lender has dropped 11 per cent since the Reserve Bank unveiled plans that would require a significant increase in the capital held by banks.
Dual-listed Australia & New Zealand Banking Group fell 3 per cent to $25 and Westpac Banking Corp was down 1.7 per cent at $25.55. Synlait Milk sank 5.9 per cent to $8.35 and Kathmandu Holdings dropped 4.3 per cent to $2.65, both in light trading. A2 Milk fell 2.1 per cent to $10.72 in modest trading.
Spark New Zealand was the most traded stock with almost 6 million shares changing hands. The shares fell 0.7 per cent to $4.17 after the company noted Australia’s Telstra will join the Southern Cross Cable Network as a customer and shareholder. Trade Me was unchanged at $6.32 on a volume of 4.7 million and
Meridian Energy slipped 0.2 per cent to $3.42. Of the other companies traded on volumes of more than 1 million shares, SkyCity Entertainment Group fell 3.1 per cent to $3.43,
Auckland International Airport
was up 0.8 per cent at $7, and Z Energy rose 0.8 per cent to $5.75.
Fletcher Building rose 2.1 per cent to $4.93 in heavier trading of 3.4 million shares. The company yesterday announced the sale of its Formica unit for US$840 million, in line with analysts’ expectations, and said it will resume paying dividends.
Mercury NZ rose 2 per cent to $3.60 and Genesis Energy was up 1.2 per cent at $2.56 in relatively light trading. Sky Network Television increased 1 per cent to $1.99 on a small volume. Air New Zealand edged up 0.2 per cent to $3.095.
Investore Property increased 0.7 per cent to $1.53 in light trading. Kiwi
Property Group fell 3.3 per cent to $1.34 on almost half its average trading volume.