US-China trade row weighs on NZ shares

Dairy stocks among those to take a hit amid fears in Asia

New Zealand shares fell as fears over the US-China trade war re-emerged and weighed on investor confidence across the region. The Fonterra Shareholders’ Fund’s recent rally also took a breather.

The S&P/NZX 50 Index declined 75.29 points, or 0.7 per cent, to 10,940.86. Within the index, 32 stocks fell, 14 rose and four were unchanged. Turnover was $122.4 million.

Stocks across Asia were weaker as volatile investor sentiment turned sour. The US Commerce Department placed 28 Chinese companies on a list banning American firms from doing business with them, before trade talks between the two nations tomorrow.

Singapore’s Straits Times Index was down 0.4 per cent in afternoon trading, while China’s Shanghai Composite Index fell 0.2 per cent and Australia’s S&P/ASX 200 Index declined 0.8 per cent.

Grant Williamson, a director at Hamilton Hindin Greene, said the ongoing dispute between US President Donald Trump’s Administration and China had weighed on Wall St, carrying through into Asian trading.

“Investors are just getting a little bit nervous with the continuing argument between Trump and China.” The Fonterra Shareholders’

Fund fell 2 per cent to $3.97 on a volume of 433,000 units, almost twice its 90-day average of 214,000.

The fund had climbed 26 per cent since unveiling a new strategy, putting its NZ assets squarely at the centre of its efforts to pursue value over volume.

“After a great run following their result, it has come under some profittaking pressure,” Williamson said. A2 Milk Co slid 1.8 per cent to

$12.81 and Synlait Milk fell 1.5 per cent to $9.02.

Chorus fell 1.2 per cent to $5.04 in relatively light trading of 213,000 shares, compared with its 522,000 average. The network operator said former NBN and Telstra executive JB Rousselot will take over as chief executive next month. The company also unveiled strong connection growth for the September quarter.

Williamson said the new CEO appeared to have good credentials and the quarterly connections went relatively well. But the stock was caught up in the broader market weakness.

New Zealand Refining led the market lower, down 2.9 per cent at $2.02 on a volume of 166,000 shares, less than its 207,000 average.

Fletcher Building was the most traded stock — 2.2 million shares, more than its 1.3 million average. It fell 1 per cent to $4.80.

Ryman Healthcare rose 0.5 per cent to $13 on an unusually large volume of 2 million shares, almost five times its 417,000 average. Of other stocks trading on volumes of more than a million shares, Spark New Zealand fell 0.8 per cent to

$4.615, Meridian Energy dropped 2.5 per cent to $5.215, Auckland International Airport slid 1.4 per cent to

$8.95, Contact Energy rose 0.6 per cent to $9.03 and Air New Zealand was down 0.7 per cent at $2.835.

Skellerup Holdings posted the day’s biggest gain, up 4.6 per cent at $2.30 on a volume of 163,000 shares, in line with its 171,000 average. It told shareholders at yesterday’s annual meeting it was on track to achieve more earnings growth in the current financial year.