Newfound optimism lifts prices by 2.9 per cent

New Zealand shares finished an already strong week with an extra surge as investors anticipated the end of strict lockdowns locally and in the United States. Tourism Holdings and SkyCity Entertainment Group notched up double-digit gains.

The S&P/NZX50 index rose 305.53 points, or 2.9 per cent, to 10,778.72. Within the index, 41 stocks increased, six fell and three were unchanged. Turnover was $354.4 million.

Sharemarkets across Asia gained after US President Donald Trump indicated he would begin reopening the US economy with a staged exit from lockdown. In New Zealand, investors continued to expect restrictions to ease after just eight new confirmed and probable cases of Covid-19 were reported yesterday.

That optimism was bolstered by reports that a Covid-19 treatment being tested by Gilead had shown promising results.

Tourism Holdings led the market higher, increasing 13.7 per cent to $1.41 on the improving virus outlook. However, Fat Prophets’ research head Greg Smith warned investors may be getting ahead of themselves as the future of tourism remained uncertain.

SkyCity rose 10.5 per cent to $2.53 and Vista Group International advanced 6.4 per cent to $1.49, well above the $1.05 price investors are paying in its $65 million capital raising. Harbour Asset Management’s Shane

Solly said the cinema software company had found strong support after raising money and was now in a strong position.

Among other companies to have recently raised capital, Kathmandu Holdings increased 5.3 per cent to 79c and Auckland International Airport rose 2.7 per cent to $6.11.

Local courier company Freightways rose 3.4 per cent to $6.93, while global logistics group Mainfreight posted the day’s biggest loss, falling 1.5 per cent to $37.43.

Air New Zealand fell 0.4 per cent to $1.31 as its rally eased after seeing strong gains across the week.

Vector was unchanged at $3.45. Power companies were stronger after the Electricity Authority released a new cost-benefit analysis for proposed changes to transmission pricing. Contact Energy rose 5.5 per cent to $6.53, Genesis Energy increased 3.2 per cent to $2.95, Mercury NZ advanced

2.3 per cent to $4.40, Meridian Energy rose

0.5 per cent to $4.37, and Trustpower edged up 0.2 per cent to $6.55.

Of the dairy stocks, Fonterra Shareholders’ Fund units fell 1.3 per cent to $3.80, a2 Milk Company rose 1.6 per cent to $19.81 and Synlait Milk advanced 2 per cent to $7.54.

Outside the benchmark index, PGG Wrightson jumped 12.9 per cent to $2.54.