Market commentaries

WELLINGTON: New Zealand shares fell for a second day as investors await earnings next week to gain a better sense of the economic outlook.

The S&P/NZX 50 Index fell 56.51 points, or 0.52%, to 10,731.55. Within the index, 16 stocks rose, 25 fell and nine were unchanged. Turnover was $126.1 million.

The benchmark opened stronger, building on momentum from Wall Street’s overnight gains, but fell away around noon when the Australian market weakened.

The S&P 500 and Dow Jones indices both closed more than 1.5% higher. At 5.30pm in Wellington, Australia’s S&P/ASX 200 had recovered earlier lost ground and was up about 0.1%.

Grant Williamson, director at Hamilton Hindin Greene, said there was little buying support in the market, which trended down as the day went on.

‘‘Investors are waiting for an update from many of these companies, so they are relatively cautious and just waiting to see what happens,’’ he said.

A number of companies, including Tilt Renewables, Kiwi Property Group, Trustpower and Mainfreight, are scheduled to report earnings next week.

A coming tranche of redundancies and fastrising unemployment numbers expected when the 12week wage subsidy ends in June could also place stress on some listed companies.

Air New Zealand has said it would reduce its workforce by 3500 and Fletcher Building on Wednesday announced it would cut 1500 jobs when its wage subsidy expires on June 26.

Mr Williamson said that, with mixed trading on the market yesterday, several of the largest stocks were the ones pushing the index negative.

Fletcher Building fell 3.3% to $3.19 as investors absorbed its projection for a 20% decline in New Zealand construction activity.

The index’s biggest company, A2 Milk, fell 1.6% to $19.17 and Spark NZ declined 2.8% to $4.415.

Fisher & Paykel Healthcare, the secondlargest company by capitalisation, held at $30.

Tourism Holdings led the market lower, falling 6.1% to $1.37, followed closely by New Zealand Refining Co, which dropped 5.2% to 73c.

Fonterra Shareholders’ Fund units rose 0.8% to $3.62.

Fonterra said it is on track to meet forecast earnings guidance of 15c to 25c a share for the year, despite market challenges related to Covid19.

CDC Data Centres, an Australian firm 48% owned by Infratil, announced plans to develop two centres in Auckland. Additional vacant land would allow for progressive development over time to meet demand from new and existing customers, Infratil said in a statement to the NZX.

Infratil shares fell 0.9% to $4.57.

Mr Williamson said Infratil had done ‘‘extremely well’’ from the data centre business and it was positive news that it was looking to replicate the operation in New Zealand.

Kiwi Property Group posted the day’s biggest gain, rising 4.4% to 94c.

Retirement village operators are beginning to rally as the risk of Covid19 outbreaks is diminishing.

‘‘There were major concerns that if any of the listed companies had issues with the virus, then that would’ve damaged their reputation,’’ Mr Williamson said.

Oceania Healthcare rose 2.6% to 79c, Arvida Group increased 1.5% to $1.40 and Ryman Healthcare advanced 1.1% to $12.60.

Metlifecare fell 0.2% to $4.34 and Summerset Group Holding declined 0.3% to $6.

Outside the NZX 50 index, Mercer Group rose 4.1% to 25.5c. The stainless steel and automation manufacturer secured more than $10 million of new orders during the past month and said it will report increased operating earnings and net profit for the June year.

■ The Australian sharemarket snapped its fourday winning streak yesterday, closing modestly lower after it failed to rise above a level closely watched by shortterm traders.

The S&P/ASX200 benchmark index finished down 22.6 points, or 0.41%, at 5550.4 points, while the All Ordinaries index closed down 19.3 points, or 0.34%, at 5660.8.