Fifth successive fall in hectic day for NZ sharemarket

The New Zealand sharemarket had a wild ride of price swings caused by index changes and ended up falling for the fifth successive day.

The S&P/NZX 50 Index fell at the opening and never recovered, declining 41.35 points or 0.35 per cent to 11,766.98. The index was down 1.3 per cent for the week, and is flat for the year to date.

The trading session was extended for the quarterly rebalance of the NZX and FTSE Russell indices.

There were 62 gainers and decliners over the whole market and the quarterly rebalance boosted trading to 122.14 million share transactions worth $514.92m.

Across the Tasman, the S&P/ASX 200 Index had fallen 0.68 per cent to 7660.9 points at 5.45pm NZ time. Shane Solly, portfolio manager with Harbour Asset Management, said it was a hectic day on the local market with lots of index changes. Some investment money was coming in because of the weakness.

He said Finance Minister Nicola Willis’ comments that economic growth was slower than expected had been anticipated by the market.

She suggested that Treasury might have to downgrade its gross domestic product forecasts when it releases its Budget Economic and Fiscal Update alongside the Budget on May 30.

Solly said the listed companies had positioned themselves for the economic slowdown with cost-out programmes and keeping debt levels under control. “But the slowdown has weighed on the market and have we reached the bottom . . . we will have to wait and see.”

Chorus, down 4c to $7.784, topped the individual trading list with 18.1m shares worth $141.88m changing hands after being removed from the FTSE Small Cap Index.

Heartland Group, falling 8c or 6.11 per cent to $1.23 on trade worth $26.10m; and Synlait Milk, declining 5c or 6.76 per cent to 69c, are also being removed from the FTSE index.

Spark, down-weighted in the NZX index, reached a five-month low after falling 6.5c to $4.90 on trade worth $65.80m.

Meridian Energy was down 14.5c or 2.54 per cent to $5.555; Mercury declined 18c or 2.63 per cent to $6.67; and a2 Milk fell 22c or 3.43 per cent to $6.20 after also having their weightings decreased.

Market leader Fisher and Paykel Healthcare was down 51c or 2.1 per cent to $23.80 after having its weighting trimmed. “The changes are all marginal stuff, and not too big,” said Solly.

Stocks experiencing increased weightings included Ebos Group adding 50c to $37.60; Skellerup Holdings, up 12c to $4.20; Arvida Group gaining 6c to $1.04; Oceania Healthcare rising 3c to 63c; and Investore increasing 5c cent to $1.15.

Rakon declined 5c to $1.23; Accordant Group decreased 2c and Eroad was down 3c to 75c. Briscoe Group declined 7c to $4.60 and Move Logistics was down 2.5c to 49.5c.