Market commentary
WELLINGTON: The New Zealand sharemarket had a small gain as investors remained cautious before the latest financial reporting season which begins in a fortnight.
The S&P/NZX 50 Index again drifted between negative and positive territory, finally ending the day up 50.54 points or 0.38% at 13,374, after reaching an intraday low of 13,287.89.
There were 67 gainers and 75 decliners over the whole market on volume of 73.09 million share transactions worth $209.76 million. The volume was boosted by the trade of 14.64 million units worth $42.32m in the S&P/NZX 50 Exchange Traded Fund.
Jeremy Sullivan, investment adviser with Hamilton Hindin Greene, said the market was pretty directionless and was cautiously watching the United States for guidance.
‘‘There is an amount of uncertainty out there. The US markets have started their reporting season and then we will move into ours, which kicks off in 1415 days,’’ Mr Sullivan said.
‘‘The NZ dollar is remaining stubbornly high and this won't please our exporters, and interest rate cuts are less likely with wholesale rates rising.’’
He said Microsoft put out a strong result after trading closed in the US overnight and this might provide a boost.
The software giant reported a 17% increase in sales to $US43.1 billion ($NZ59.64 billion) for its second quarter and its net income rose 30% to $US15.5 billion, ahead of Wall Street's expectation of $US12.6 billion income and $US40.2 billion sales. Microsoft's share price climbed more than 4% in afterhours trading.
The leading US indices were flat, the Dow Jones
Industrial Average increasing 0.074% to 30,937.04, the S&P 500 Index up 0.15% to 3849.62 and the Nasdaq Composite edging ahead 0.073% to 13,626.06.
Back home, a2 Milk and Synlait worked in tandem with strong rises, after Synlait announced this week it is increasing its forecast milk price to $7.20kg milk solids, from $6.40kgMS, for the 202021 season, driven by the strong rise in dairy commodity prices. Synlait rose 12c to $4.83, and a2 Milk was up 43c to $11.50 on trade worth $13.09 million.
Market leader Fisher and Paykel Healthcare had a more settled day, rising 45c to $35.20 on trade worth $20.3 million and Freightways broke through the $11 mark for the first time, before finishing at $10.99, up 9c.
Other gainers were takeover target Infratil, up 10c to $7.85, Serko up 19c to $5.69, retirement village operator Arvida gaining 4c to $1.79, Foley Wines increasing 10c to $1.99, Just Life climbing a further 12c to $1.03; and Scott Technology up 9c to $2.35.
The energy stocks again had a mixed day. Contact was down 16c to $8.74, Meridian fell 15c to $7.75, while Mercury rose 17c to $7.37, Trustpower increased 10c to $8.76 Genesis gained 6.5c to $3.895 and Vector rose 6c to $4.31.
Fletcher Building's strong run faltered with a loss of 20c to $6.35, Mainfreight shed 40c to $68.40 and South Port New Zealand lost all that it gained the day before, falling 31c to $8.39.
Cooperative Livestock Improvement Corporation (LIC) reported a 10.4% increase in net profit to $33.43 million for the six months ending November and its share price rose 3c to 84c. —