Red across the exchange as Covid fears grow

The New Zealand sharemarket fell nearly half a per cent in line with offshore bourses on renewed fear that the resurgence of Covid-19 in some countries may slow global economic recovery.

The S&P/NZX 50 Index shed 62.16 points or 0.49 per cent to 12,690.35 points, after falling for most of the day and reaching a low of 12,640.56 before rebounding in the last half-hour of trading.

There was red across the market, with 82 decliners and 50 gainers on volume of 48.36 million share transactions worth $184.92m.

Mark Lister, head of private wealth research at Craigs Investment Partners, said the local market followed global leads.

“All international markets were weaker as investors questioned whether the economic recovery was losing momentum. The latest jobless claims in the United States were higher than expected, the longer term interest rates are pulling back, and there’s the troublesome Delta Covid variant in some parts of the UK, Europe, US and Australia.

“It wasn’t surprising that our market found reasons to take a breather. The fresh Covid cases and lockdowns are a reminder that we are only one step away from further restrictions,” said Lister.

On Wall Street overnight, the three major indices suffered their worst daily performance in nearly three weeks. The Dow Jones Industrial Average fell 260 points or 0.75 per cent to 34,421.93; the S&P 500 Index was down 0.9 per cent to 4320.82; and the Nasdaq Composite declined 0.7 per cent to

14,559.78. Across the Tasman, the S&P/ASX

200 Index was down 1.24 per cent to 7250.2 points at 5.45pm NZ time.

The local market will be closely watching the latest inflation data and Reserve Bank monetary policy approach next week, as well as the start of the new US reporting season.

Among the small group of gainers, Freightways rose 22c or 1.76 per cent to

$12.75; Ebos Group was up 21c to $32; CDL Investments gained 3.5c or 3.04 per cent to $1.185; Vital Healthcare increased 2.5c to $3.305; and Scott Technology was up 3c to $2.75. My Food Bag also went against the trend, gaining 2c to $1.34.

Napier Port edged ahead 1c to $3.45 after reporting increased trade, particularly logs, for the third quarter ending June.

Among blue-chip stocks, Meridian Energy fell 6c to $5.22; Auckland International Airport declined 11c to $7.46; Spark lost 2.5c to $4.89; and Mainfreight shed $1.14 to $76.05, after reaching $80 at the start of the week. Ryman Healthcare fell another 15c to $13.09 and Synlait declined 6c to $3.81.