MARKET CLOSE: NZ shares fall to 5-week low as trade tensions spook investors; A2 drops
By Rebecca Howard
Dec. 10 (BusinessDesk) - New Zealand shares fell to a five-week low as rising concerns about global growth due to
heightened US-China trade tensions extended into Asian markets. Export-focused A2 Milk dropped.
The S/NZX 50 index declined 107.3 points, or 1.2 percent, to 8,660.02, the lowest close since Oct. 30. Within the index, 38
stocks fell, nine gained and three were unchanged. Turnover was quieter than usual at $78.7 million.
Wall Street lost ground on Friday and Asian markets followed suit on concerns that Canada's arrest of Huawei global
chief financial officer Meng Wanzhou could derail the temporary truce between the US and China. US authorities are
seeking her extradition over claims she was involved in violating US sanctions against Iran. China on Sunday demanded
the United States should withdraw the arrest warrant. The flare-up in tensions come just as the two nations kick off 90
days of negotiations.
The S 500 Index fell 2.3 percent on Friday, while across Asia today, Australia's S/ASX 200 was down 2.2 percent in afternoon trading and Hong Kong's Hang Seng declined 1.4 percent.
Hamilton Hindin Greene director Grant Williamson said while the New Zealand market was down it was outperforming
Australia.
"We've probably held up reasonably well but certainly, the sellers are in charge of the market today," said Williamson.
Dual-listed companies were among those hardest hit.
Sky Network Television led the market lower, sliding 7.1 percent to $2.11 and Fletcher Building dropped 3.4 percent to
$4.56, both on light trading volumes.
A2 fell 4.1 percent to $10.57 on half its average trading volume. The milk products marketing firm today announced the
departure of general manager of international development Simon Hennessy and head of emerging markets business
development Michael Bracka.
Australia & New Zealand Banking Group dropped 3.8 percent to $25.95 and Westpac Banking Corp declined 3.4 percent to $26.14.
Spark New Zealand was the most traded stock, with 2.3 million shares changing hands compared to the 3 million 90-day
average. Spark rose 1.7 percent to $4.27, posting the biggest gain on the day.
"It is really quite defensive and investors are considering Spark to be quite a safe haven, as it produces an extremely
good dividend income," Williamson said. "It is performing particularly well and has done all the way through this market
correction in the past couple of months."
Of other stocks with more than 1 million volume, Meridian Energy fell 1.2 percent to $3.22, Auckland International
Airport dropped 2.1 percent to $7.10 and Contact Energy decreased 0.4 percent to $5.70.
Air New Zealand fell 2.2 percent to $2.965, a month low. Brent crude oil prices rose 0.5 percent to US$61.96 a barrel in
Asia trading after Opec producers and other nations, including Russia, agreed to cut output by 1.2 million barrels a day
from January. The airline is also in pay negotiations with its engineers who are threatening to down tools before
Christmas.
Trade Me declined 1.9 percent to $6.07. Veteran chief executive Jon Macdonald will stay on a little longer while the
online marketplace considers competing takeover bids.
Retailers were mixed after Paymark figures showed a muted start to the Christmas spending season. Briscoe Group
increased 0.3 percent to $3.32, while Hallenstein Glasson dropped 8.3 percent to $4.45 and Warehouse Group was down 1.5
percent at $2.02. Kathmandu Holdings was unchanged at $2.66.
(BusinessDesk)