Port of Tauranga hits a record as prices rise

New Zealand shares rose as index changes drove heavy trading and large moves in the likes of Port of Tauranga and Kiwi Property Group. An upbeat earnings season also supported investor sentiment.

The S&P/NZX 50 index rose 29.46 points, or 0.3 per cent, to 11,254.74. Within the index, 26 stocks rose, 21 fell, and three were unchanged. Turnover was $427.6 million with new weightings in S&P/NZ indices and FTSE/Russell indices prompting large investors to adjust their portfolios.

The benchmark index gained more than 3 per cent this week as investors looked past the threat of a second wave of Covid-19 in favour of a better-than-expected earnings season.

Shane Solly, portfolio manager at Harbour Asset Management, said fears of a second wave had shifted which stocks investors were buying.

The “dash for trash” — as investors bought into the hard-hit stocks once the economy reopened — had slowed as the pandemic proved more persistent than some had hoped, he said.

However, “reporting season has been better than expected, companies in general have delivered less-worse results,” Solly said.

Investors resetting their portfolios in line with the NZX 50’s quarterly reweighting was causing some significant share price movements yesterday, Solly said.

Port of Tauranga led the market higher, rising 9.9 per cent to an all-time high at $8.09 with 1.1 million shares traded. Solly said the stock had generally been performing strongly but yesterday’s jump was driven by the index reweighting.

Sky Network Television rose 6.5 per cent to 16.3c, Kiwi Property Group increased 6.4 per cent to $1.08 and

Kathmandu Holdings was up 5.1 per cent at $1.24.

SkyCity Entertainment Group rose 4.8 per cent to $2.85 as it continued to bounce back from recent lows after raising new capital this week. The casino operator had shown a reasonably strong recovery from the lockdown which reassured investors, Solly said.

Meridian Energy advanced 2.9 per cent to $5.03 and Contact Energy increased 0.3 per cent higher to $6.39 as investors digested strong generation numbers released on Thursday.

Auckland International Airport rose 4 per cent to $6.81, while Air New Zealand dropped 3.2 per cent to $1.51.

Research analysts at Jarden yesterday downgraded the airline to “underperform” and set a target price of 85c. A note to clients said that without a capital injection the airline would have to begin using the Government’s $900 million loan in the 2021 financial year.

Gentrack posted the day’s biggest loss on its last day of trading as part of the NZX50 index, falling 4.5 per cent to $1.50. It is up 9.8 per cent this month but down almost 60 per cent this year.