Market commentary
WELLINGTON: Strong showings in the United States and Australian indices buoyed the New Zealand sharemarket, with a recovering a2 Milk providing the backbone.
The S&P/NZX 50 Index had its second successful strong rise, climbing 151.26 points to 12,055.05 on 72.5 million trades worth $252.5 million. There were 95 gainers and 43 decliners over the whole market.
The a2 Milk Company fired into action, rising 49c or 2.68% to $18.79 on trade worth $30.6 million. Over the past fortnight, it had fallen from $21.50 to $18.30. Fisher and Paykel Healthcare was up 6c to $36.21 on trade worth $48 million.
David Price, Forsyth Barr’s director, international equities, said a2 Milk had been dragging the market down, and now was lifting it back up. The offshore markets, including Australia, had a better day and the duallisted stocks such as a2 Milk had benefited.
The S&P 500 and Nasdaq indices scaled new heights in the United States overnight and at 5.30pm the Australian S&P/ASX 200 Index was up 47.4 points or 0.78% to 6110.6, with duallisted SkyCity leading the way.
Mr Price said, ‘‘Investors are now playing the recovery stocks and opening up trades in sectors like tourism and leisure as hospitalisation rates come down in the United States.’’
Auckland International Airport was up 26c or 3.86% to $7.00, cinema software company Vista Group increased 9c or 4.86% to $1.94, and online travel provider Serko increased 15c or 4% to $3.90. Cinema operator AMC Entertainment said it was opening up a further 140 movie theatres in the US this week, taking its total operating to 420.
SkyCity was the day’s biggest mover, rising 17c or 6.8% to $2.67 on trade worth $3.3 million after producing a betterthanexpected fullyear result. SkyCity reported a near 60% drop in net profit to $66.3 million from $164.6 million on revenue of $779 million, down 24.3% from $1.029 billion. It is not paying a final dividend or an interim in the 2021 financial year, but is expecting to resume payment in September/October next year.
Mr Price said SkyCity was trading more strongly than people expected and they were not alone in not paying a dividend. ‘‘You can’t pay a dividend when you’ve had a capital raising.’’
Other strong movers were Ryman Healthcare , up 16c, to $14; Briscoe Group gained 14c or 3.85% to $3.78; Mercury Energy increased 23c or 4.54% to $5.30; Trustpower rose 18c or 2.6% to $7.11; Sanford climbed 14c or 2.46% to $5.84; and Fletcher Building continued its run, up 8c to $3.65.
Pushpay , which has seen former directors selling shares, was down 18c to $8.07; and Delegat Group stuttered, falling 44c or 2.95% to $14.50.
The increase in investor interest on the local sharemarket was shown in NZX’s latest monthly statistics. Total trades in August were up 112% compared with the corresponding month last year and the total value increased 15.3%. —