INDEPENDENT NEWS

MARKET CLOSE: NZ shares gain as investors eye Fed meeting

Published: Tue 18 Jun 2019 08:57 PM
MARKET CLOSE: NZ shares gain as investors eye upcoming Fed meeting
By Paul McBeth
June 18 (BusinessDesk) - New Zealand shares joined a rally across Asia, as investors have one eye on whether the Federal Reserve will signal lower US interest rates in what would be a further boon for equity markets. Vista Group International led the market higher.
The S/NZX 50 Index rose 21.07 points, or 0.2 percent, to 10,191.33. Within the index, 25 stocks gained, 16 fell, and nine were unchanged. Turnover was $125.5 million.
Stocks across Asia were generally stronger, with Australia's S/ASX 200 Index up 0.5 percent in late trading and Singapore's Straits Times Index rising 0.8 percent. The Federal Open Market Committee will review US rates this week, and investors are hoping for a steer on whether the world's biggest central bank will cut its benchmark interest rate.
"The market's drifting sideways a little bit, waiting for the outcome of the FOMC meeting," said Craigs Investment Partners investment advisor Peter McIntyre.
"Market pricing is that rates are going to go lower - the market's not looking for an immediate rate cut, but is looking for confirmation that over the coming six months the Fed is going to cut rates, which is supportive for equities."
Tech stock Vista, an export firm which develops cinema analytics software, led the market higher. It was up 4.6 percent at a record close of $6.12 on 93,000 shares, less than its 90-day average of 391,000.
Low rates have underpinned New Zealand's benchmark stock index and its large contingent of infrastructure companies, utilities, and property stocks which typically pay reliable dividends.
Infrastructure investor Infratil is among those firms, and closed at a record $4.59, up 2.9 percent, on a volume of 1.2 million shares. That was almost twice its 90-day average. The company allotted 45.5 million shares issued under the retail component of its $400 million capital raising.
McIntyre said the shares were issued at $4 each, meaning those investors who took up their entitlements are already in the money.
Meridian Energy rose 2 percent to $4.50 on a volume of 2 million shares, Ryman Healthcare advanced 1.9 percent to $11.58, Contact Energy increased 1.3 percent to $7.62 and Chorus was up 1.3 percent at $5.85.
Spark New Zealand was the most traded stock on a volume of 3.3 million shares, down on its usual volume of about 5.4 million. It rose 1.6 percent to $3.91 after saying it will offer free access to streaming coverage of the Rugby World Cup for customers who sign up to certain mobile or broadband contracts.
Sky Network Television, which has had a strong grip on rugby broadcast rights for the past two decades, rose 1.7 percent to $1.20.
Of other companies trading on volumes of more than a million shares, SkyCity Entertainment Group was unchanged at $3.78, Z Energy rose 0.3 percent to $6.10, Oceania Healthcare decreased 1 percent to $1.04, Auckland International Airport fell 0.7 percent to $8.77 and Kiwi Property Group was unchanged at $1.57.
A2 Milk Co posted the day's biggest decline, down 2.7 percent at $14.24 on a volume of 804,00 shares, in line with its 90-day average.
McIntyre said the benchmark held up well given A2's large weighting on the index. But he said the stock's been pushed around in the past month on fears that China's desire for more locally produced formula may weigh on the company over the next three-to-four years.
"The underlying story there hasn't gone away, it's just being buffeted by those factors," he said.
Synlait Milk, which supplies A2, rose 1 percent to $10.10. Fonterra Shareholders' Fund units declined 0.3 percent to $3.91.
NZX was unchanged at $1.09 ahead of tomorrow's Cannasouth listing. The pre-revenue medicinal cannabis firm is the first new listing in more than two years.
Vector's 2025 bonds, which pay annual interest of 3.45 percent, were the most traded debt security on a volume of 730,000. The notes closed at an unchanged yield of 3 percent.
(BusinessDesk)
BusinessDesk
Independent, Trustworthy New Zealand Business News
The Wellington-based BusinessDesk team provides a daily news feed for a serious business audience.
Contact BusinessDesk
Email:

Next in Business, Science, and Tech

Auckland port move: Cabinet ministers deliberate on decision
By: RNZ
Dead rats washed up on beaches sent for toxicology testing
By: RNZ
Resource Strategy plots path ahead for sector
By: Ministry of Business Innovation and Employment
Methane satellite mission control in New Zealand
By: New Zealand Government
Late spring surge as we head into summer
By: QV Valuations
New Zealanders feel financially better off
By: Statistics New Zealand
Moving port will cost Government, consumers and environment
By: National Road Carriers
Caution urged over rat carcasses on beach
By: Department of Conservation
MBIE plans for budget changes due to ‘no new mines’ policy
By: NZ Energy and Environment Business Week
Government’s resources strategy all spin and no substance
By: New Zealand National Party
Resource strategy could hinder delivery of energy to NZers
By: NZ Petroleum Exploration and Production Assn
Minerals Sector Contributes Significantly to Wellbeing
By: Straterra
"Shoddy" NZ oil strategy released as scientists raise alarm
By: Greenpeace
New Government mining strategy lacks urgency, clout
By: Forest And Bird
New Zealand joins MethaneSAT climate mission in space
By: Ministry of Business Innovation and Employment
View as: DESKTOP | MOBILEWe're in BETA! Send Feedback © Scoop Media