NZ sharemarket continues its downward trend

New Zealand shares fell for a sixth session as rising US bond yields dented investors’ appetite for stocks. Synlait Milk led the market lower, dropping to a five-month low.

The S&P/NZX 50 index declined 42.31 points, or 0.5 per cent, to 9214.87. Within the index, 30 stocks fell, 13 gained and seven were unchanged. Turnover was a quieter than usual $79.1 million.

Stocks across Asia were largely weaker, following Wall Street’s lead, after the yield on US 10-year Treasuries rose to a seven-year high. Investors expect strong US economic data will prompt the Federal Reserve to hike interest rates more aggressively, making fixed-income assets more attractive.

Peter McIntyre, an investment adviser at Craigs Investment Partners, said markets have already priced in three interest rate increases in the US for 2019.

“The interest rate theme is not going to go away,” he said.

Rate-sensitive stocks fell. Genesis Energy dropped 3.2 per cent to $2.42, Investore Property declined 2.6 per cent to $1.53, Property For Industry declined 1.4 per cent to $1.75, and Mercury NZ was down 1.1 per cent at $3.305.

Pushpay Holdings fell 1.5 per cent to $4.04 and Gentrack Group slid 1 per cent to $7.14. Synlait led the market lower, falling

5.7 per cent to $10, its lowest close since May

1. The stock has lost 25 per cent over the past month as investors cash in gains after a prolonged rally. A2 Milk Co fell 1 per cent to $10.59, its fifth straight decline. A2’s market capitalisation has dropped to $7.9 billion, making it the fourth biggest local company on the NZX behind Fisher & Paykel Healthcare, Auckland International Airport and Meridian Energy. F&P Health fell 0.8 per cent to $15, Auckland Airport rose 1 per cent to $7.25, and Meridian slipped 0.3 per cent to $3.23.

Spark New Zealand comes in below a2 with a market cap of $7.42b. It decreased 0.3 per cent yesterday to $4.01. Chorus, which was demerged from Telecom seven years ago, rose 0.4 per cent to $4.85 and has a market value of $2.09b. Air New Zealand fell 1.7 per cent to $2.955. The national carrier had a strategic partnership with Singapore Airlines reauthorised yesterday.

Summerset Group declined 0.8 per cent to $7.58 after buying an 8ha site in Papamoa Beach for a $150m-plus village. The development is Summerset’s first in Tauranga and is expected to be built in 2020.

Comvita rose 2.2 per cent to $6.05, posting the biggest gain on the day.

Outside the benchmark index, Eroad declined 0.9 per cent to $3.28 after reporting faster sales growth in the second quarter. NZ

Windfarms gained 2.3 per cent to 13.4c after appointing First NZ Capital to help sell its Te Rere Hau wind farm.