Market commentary

WELLINGTON: The New Zealand sharemarket drifted yesterday after another selloff on Wall Street, but the low interest rate environment is likely to underpin further positive gains here.

The S&P/NZX 50 Index finished at 11,748.30, down 63.75 points or 0.54% after moving between a low of 11,684.560 and high of 11,813.78 on trading of 53.21 million shares worth $167.36 million.

There were 62 gainers and 73 decliners over the whole market.

‘‘We are now entering the unknown territory of negative interest rates, and shares and property will benefit from this,’’ investment advisor with Hamilton Hindin Greene Jeremy Sullivan said

The 2023 government bond was now paying minus 0.004%, and a total of $10 billion was withdrawn from bank term deposits in July — the first time there has been a reduction in 10 years.

‘‘The Reserve Bank is planning another cash rate cut in February, the NZX is getting ready for negative bond yields and banks have been asked to get their systems in place by September.

‘‘There’s a wall of money out there looking for a home and, broadly speaking, the sharemarket will continue to rise. The market has defensive stocks paying good dividends and they are ripe for investors,’’ Mr Sullivan said.

One of the day’s biggest movers was retailer Briscoe Group, climbing 16c or 4.2% to $4.04. Freightways was 13c to $7.44 and Foley Wines gained 5c or 2.58% to $1.99.

Market heavyweight Fisher and Paykel Healthcare, which has experienced strong growth this year, continued to lose ground — just like the hot technology stocks in the United States, with investors taking profits. Fisher and Paykel fell 59c to $33.02 on trade worth $31.24m after last month reaching a high of $37.68.

Auckland International Airport was down 6.5c to $7.045 and most of the energy companies had falls. Genesis was down 9c or 3.09% to $2.82, Contact declined 6c to $6.24, Mercury slipped 6.5c to $5.215, and Meridian was up 2.5c to $4.995.

Sky Network Television chief executive Martin Stewart went on the market and bought 250,000 shares at an average of 15c each for an outlay of $37,500. He now holds 1.286 million shares in the network. Sky TV’s share price crept up 0.1c to 14.9c a day after reporting its latest fullyear result.

Fellow property company Asset Plus reaped more than $34 million from institutions as part of its $60 million capital raising to fund developments at an Albany property, to be leased by Auckland Council. Asset Plus fell 2.5c or 6.85% to 34c.

Retirement village operator Summerset Group filled its sevenyear bond issue of $150 million, with a minimum rate of 2.3% a year. The bonds will be issued on September 21.

Summerset’s share price increased 5c to $8.50.

Competitor Ryman Healthcare fell 11c to $13.59.

In the United States, the Dow Jones Industrial index had its second 400point fall in three days, finishing at 27,534.58, down 1.45%, after opening the day strongly. The S&P 500 was down 1.76% to 3339.19 and the Nasdaq Composite fell 1.99% to 10,919.59. —