Week’s gain has shares in the black for 2023
The New Zealand sharemarket closed the week with a flat day as it grappled with a slowing economy and a further earnings downgrade, this time from SkyCity.
The S& P/ NZX 50 Index recovered from its intraday low of 11,408.25 and finished on 11,495.64, down 0.97 points or 0.01 per cent. The index is still 0.3 per cent ahead for the year after gaining 1 per cent this week.
There were 57 gainers and 61 decliners over the market, with rebalancing in the FTSE and NZX indices creating some volatility before next Friday’s deadline. A total of 25.85 million shares worth $ 104.17m changed hands.
SkyCity Entertainment declined 8c or 4.28 per cent to $ 1.79 after revising its guidance following five months of trading in the new financial year. SkyCity i s facing reduced gaming machine revenue in New Zealand and a weaker- than- expected performance from its Adelaide business.
The casino and hotel operator is now expecting full- year operating earnings ( Ebitda) of $ 290m-$ 310m, down from last year’s $ 310m. SkyCity had previously forecast a modest year- on- year increase.
Shane Solly, portfolio manager with Harbour Asset Management, said the SkyCity downgrade was disappointing but not surprising. The cost of living had slowed its activity in New Zealand.
He said other companies such as Air New Zealand, Kiwi Property and Freightways had talked about slowing domestic activity and retail sales. “Will there be others — I think so.
“The New Zealand economy i s slowing down quite rapidly and the Reserve Bank may be working with a different set of data points when it comes back from holiday in the New Year.
“It is a good reminder of what we are dealing with under the [ Reserve Bank’s] tight monetary policy. The market just has to get through this earnings- reset period,” Solly said.
In the US, the technology- driven Nasdaq Composite surged 1.37 per cent to 14,339.99 points, and has risen more than 36 per cent this year.
At home, Scales Corp increased
7c or 2.28 per cent to $ 3.14 after confirming net profit guidance of $ 14m-$ 19m for the 12 months ending December and then doubling the
2024 profit forecast to $ 30m-$ 35m. Scales is paying an interim dividend for the 2023 financial year of
4.25c a share on January 18.
Fisher & Paykel Healthcare was up 15c to $ 24; Ebos Group increased 63c to $ 37.53; Mercury Energy added 7c to $ 6.32; and Meridian collected 5c to $ 5.25.
Auckland International Airport gained 5c to $ 8.25 on trade worth $ 23.2m; Briscoe Group was up 10c or
2.18 per cent to $ 4.69; and Eroad continued a good run, rising 9c or 9.89 per cent to $ 1. Infratil declined 13c to $ 9.92; Freightways decreased 11c to $ 8.32; Gentrack shed 8c to $ 6.35; and
NZME fell 4c or 4.44 per cent to 86c.