Market commentary

WELLINGTON: Global transport operator Mainfreight took its turn to lead the New Zealand sharemarket to greater heights yesterday.

The recovery since the low days of late March and the nationwide Covid19 lockdown is now being described as ‘‘an early Santa Claus rally’’.

The S&P/NZX 50 Index rose for the 11th day, increasing 89.76 points to 12,543.61.

There were 77 gainers and 55 decliners over the whole market on solid volume of 56.49 million shares worth $206.01 million.

When the index fell to its lowest mark this year of 8498.69 points on March 23, noone would have expected the 50%plus rebound would happen so quickly and so strongly.

Forsyth Barr investment adviser Dan Stratful said over the past five years the market had recorded price increases in December, which had become known as the Santa Claus rally: ‘‘It seems to have come early this year.’’

The market recovery was ‘‘a bit of surprise coming up to the United States election’’.

‘‘You wouldn’t think we are in a socalled recession and the New Zealand market is hitting new highs. It’s been a defiant recovery driven by low interest rates.’’

Mainfreight broke through the $50 mark to a record after reporting increased business for the first six months of its 2021 financial year. It climbed $2.80 to $51.30 on 825 trades worth $3.3 million.

Mainfreight’s share price has doubled since it was $25.10 on the index’s lowest day this year on March 23.

The transport operator said estimated revenue for the halfyear ended September improved 7.2% to $1.6 billion and gross profit was up 23.4% to $102 million.

Ongoing trading improvements from established customers and increasing market shares kept all three divisions — transport, warehousing and air and ocean freight — busy, the company said.

Cancer diagnostics company Pacific Edge, with a market capitalisation of $529,000, sprang to life after announcing it will be rejoining the NZX 50 Index on October 21 to replace Metlifecare, which will be dropping off after the takeover by Asia Pacific Village Group, subject to final court approval.

Pacific Edge’s newly gained status pushed up its price 8c to 73c on heavy trading of 6.13 million shares worth $4.5 million. Pacific Edge was last in the top 50 index between March 2014 and September 2015 after which its share price languished around 15c until recently.

Ebos Group had another strong day, rising 90c to $26.90, a2 Milk was up 14c to $16.26, Pushpay Holdings gained 15c to $9.40, Infratil climbed 15c to $5.31, Restaurant Brands recovered 32c to $12.17, and Fisher and Paykel Healthcare increased 39c to $35.75.

Jeweller Michael Hill International was one of the day’s biggest movers, rising 5.5c to 50c.

Software firm ikeGPS Group, which analyses pole and overhead asset information, has signed up with one of United States’ largest electricity companies and its share price shot up 20c or 22.22% to $1.10.

The hot property sector is experiencing ‘‘cap rate compression’’ in a market where keen investors are driving up values.

Argosy Property rose 2.5c to $1.435, Property for Industry gained 3c to $2.85, and Stride Property increased 5c to $2.25.

The movers in the energy sector were Vector, up 9c to $4.44, and Genesis, up 4c to $3.15.

Auckland International Airport lost 5c to $7.45 after reporting a further decline in passenger traffic in August and September.

Strong performer Ryman Healthcare fell 6c to $15.11, Hallenstein Glasson lost 15c to $6, and Fletcher Building declined 9c to $4.26. —