Market commentary
WELLINGTON: The New Zealand sharemarket rebounded yesterday on news that the country, except for Auckland, was moving to Alert Level 2 today — a move that will boost economic activity.
The S&P/NZX 50 Index reached an intraday low of 13,233.88 but recovered in the last hour of trading to close at 13,300.03, up 11.15 points, or 0.08%.
There were 51 gainers and 83 decliners across the whole market but volume was light, 40.77 million shares worth $120.64 million changing hands.
Hamilton Hindin Greene investment adviser Jeremy Sullivan said the retailers would be pleased with the Level 2 announcement because of pentup spending demand caused by the lockdown, and expected to see a further impetus to the property market.
However, the renewed prospect of increased interest rates would now weigh on the market.
‘‘You may see the Reserve Bank implement a steeper rise in the official cash rate next month.
‘‘Swap rates were beginning to rise soon after the Government announcement, and interest ratesensitive stocks are coming under pressure,’’ he said.
Chorus fell 13c, or 1.81%, to $7.07; Contact was down 13c to $8.12; Meridian declined 9.5c, or 1.82%, to $5.12; Vector decreased 8c, or 1.87%, to $4.20; and Trustpower shed 10c to $7.80.
Among other interest ratesensitive stocks, Spark increased 6c to $4.89; Argosy Property gained 4.5c, or 2.67%, to $1.73; and Vital Healthcare Property was up 4.5c to $3.225.
Fast food operator Restaurant Brands, now expecting more sales in Level 2, rose 19c to $15.70. Travel stocks were also boosted. Auckland International Airport was up 7c to $7.32, and Air New Zealand gained 1.5c to $1.58.
The a2 Milk Company continued to be battered, falling 5c to $5.93 on the news that it will be removed from the S&P/ASX 50 Index on September 20 as its market capitalisation has fallen below $5 billion.
Synlait will be removed from the ASX 300 Index, and its share price fell 12c, or 3.58%, to $3.23. Another New Zealand company, Smartpay Holdings, is going out of the ASX All Technology Index, and its share price was down 0.005c to 77c.
Freightways, up 13c to $12.94, will be added to the S&P/NZX 20 Index in place of Z Energy. Freightways has increased 71% over the past 12 months and has a market capitalisation of $2.14 billion to Z Energy’s $1.84 billion.
Market leader Fisher & Paykel Healthcare rose 30c to $33.75; Delegat Group was up 30c, or 2.17%, to $14.10; DGL Group increased 5c, or 1.98%, to $2.57; and Bremworth climbed 6c, or 8.7%, to 75c. Pacific Edge picked up 8c, or 5.67%, to $1.49. Among the decliners, Ebos Group was down 34c to $34.81; South Port New Zealand fell 12c to $9; Move Logistics shed 5c, or 2.86%, to $1.70; and Serko decreased 17c, or 2.04%, to $8.15;
Manuka honey exporter Comvita gained 1c to $3.70 after announcing an interesting partnership with Caravan, a joint venture with entertainment and sports agency, Creative Artists Agency. —