Index closes out tepid week with another fall

The New Zealand sharemarket ended a miserable week with its fourth fall following another sell-off on Wall Street.

Even an upbeat trading report from Michael Hill International couldn’t inspire the local market.

The S&P/NZX 50 Index began falling at noon after its Australian counterpart opened weak. The index closed at 12,790.16, down 36.82 points or 0.29 per cent after reaching a morning high of 12,847.33 and improving late in the day.

The index fell nearly 1.4 per cent for the week. On another quiet trading day, 23.16 million shares worth $102.52m changed hands, and there were 54 gainers and 86 decliners across the whole market.

Matt Goodson, managing director of Salt Funds Management, said the local market followed offshore leads and was muted.

“One of the voting Federal Reserve governors commented there should be four or five interest rate hikes this year — that’s the first time I’ve heard that,” Goodson said.

“Central banks like the Federal Reserve and Reserve Bank of Australia are still behind the curve and carrying out quantitative easing. Their actions are not yet aligned with what they are saying (tightening monetary policy), but that’s about to change quickly.”

Goodson said the company earnings season and outlook statements are coming up in a month and “we will be a lot wiser then about the direction of the local market.”

The high-growth technology stocks in the United States were again hit overnight. Electric vehicle maker Tesla led the falls with a decline of 6.75 per cent to US$1031.56 ($1503.76), and Microsoft was down 4.23 per cent to US$304.80.

The Nasdaq Composite had its worst close since October after falling 2.51 per cent to 14,806.8 points. The Dow Jones Industrial Average was down 0.49 per cent to 36,113.62, and S&P 500 declined 1.42 per cent to 4659.03.

The S&P/ASX 200 Index was down 0.95 per cent to 7403.3 at 5.45pm NZ time.

Michael Hill International slipped 2c to $1.51 after reporting strong growth for the quarter ending December 26.

The jewellery retailer has now had 10 quarters of same store sales growth since the third quarter of 2019. It was a soggy day for the retailers. The Warehouse Group was down 11c or 3.05 per cent to $3.50; Briscoe Group declined 19c or 2.86 per cent to $6.45 and Hallenstein Glasson shed 5c to $6.88; and Kathmandu Holdings slid 2c to $1.40.

Ebos Group collected 18c to $40; Mainfreight gained $1.10 to $93; Contact Energy was up 14c or 1.77 per cent to $8.04 and reinvigorated Steel & Tube rose 6c or 3.68 per cent to $1.69.