Falling Oz inflation rate lifts local index
NZX-50 climbs 1.38% to reach highest point in nine weeks
Afall in the Australian inflation rate provided a boost for sharemarkets on both sides of the Tasman, and New Zealand’s was particularly invigorated, kicking on by more than one per cent.
The S&P/NZX 50 Index was strong in the afternoon and climbed 156.68 points or 1.38 per cent to 11,552.04 — its highest level in nine weeks. The index has now fallen around 11.5 per cent this year.
There were 80 gainers and 54 decliners on the main board in an extended trading session for the quarterly review and rebalancing of the MSCI equity indices.
Volume reached 81.96 million share transactions worth a whopping $567.25 million, and there was heavy trading in Ebos Group which is entering the MSCI Small Cap index.
Transtasman health and animal care products supplier Ebos was up 76c or 1.89 per cent to $40.95 on trade worth $201.48m, turning around from an intraday low of $38.60.
Helped by smaller increases in food and travel, the Australian October consumer price index showed a fall in inflation to 6.9 per cent, from 7.3 per cent in September, and below the expected 7.4 per cent. New Zealand inflation is 7.2 per cent.
Economists across the Tasman are now saying inflation may be nearing a peak but not quite yet due to the impact of energy prices and flooding.
The S&P/ASX 200 Index was up 0.35 per cent to 7279 points at 6pm NZ time. Investors would also be watching out for US Federal Reserve chair Jerome Powell’s latest speech on monetary policy overnight.
Jeremy Sullivan, investment adviser with Hindin Hamilton Greene, said Germany also had a half per cent rise in October — running at annualised inflation of 6 per cent — and “maybe we are seeing some green shoots of inflation slowing.
“This is good for interest rate expectations and with them coming down, company asset values will go up,” said Sullivan.
Fisher & Paykel Healthcare had its second successive strong day after reporting a better-than-expected halfyear result, rising 79c or 3.46 per cent to $23.60 on trade worth $72.6m.
The energy sector had a strong day. Meridian increased 15.5c or 3.27 per cent to $4.895, Contact gained 16c or 2.18 per cent to $7.49; Mercury rose 25.5c or 4.86 per cent to $5.50; and
Vector was up 9c or 2.2 per cent to $4.18.
Napier Port rose 13c or 4.73 per cent to $2.88 after completing its buyback of 125,000 shares.
Utilities software firm Gentrack continued to surge after increasing revenue and upgrading its full-year guidance, climbing 38c or 19 per cent to $2.38. It has risen more than 37 per cent in two days.
Precinct Properties, gaining 7c or 5.79 per cent to $1.28, is buying 61 Molesworth St in Wellington — home to the Ministry of Foreign Affairs and Trade — and will be developing an 11 level, 24,000sq m office building on the site.
Asset Plus, up 1c or 4.55 per cent to 23c, told the market it has sold bare land in Kamo, Whangarei. It is also selling the Auckland Graham St building and is marketing its Stoddard Rd property.
Chair Greg Campbell is stepping down from Ryman Healthcare’s board because of health issues and long-serving director Claire Higgins steps up as interim chair. Ryman’s share price was down 5c to $6.65.
Third Age Health, unchanged at $1.79, earlier reported a net profit of $324,000 on revenue of $4.67m, up 61.2 per cent, for the six months ending September and is paying an interim dividend of 2.44c a share on December 16.