NZX Lifts 0.2% As Markets Wait For US Fed Decision

It’s all eyes on Jerome Powell and the other US Federal Reserve governors in equity markets as a strong lead from Wall Street has lifted the New Zealand benchmark. The S&P/NZX 50 gained 0.2% to 13,234.89 points on Tuesday, with turnover of 38.6 million shares worth over $145.8m.

Jeremy Sullivan, an investment advisor at Hamilton Hindin Greene, said investors' eyes were on the Federal Reserve, which will release its decision on cutting interest rates on Wednesday.  "It's pretty much a done deal on a rate cut in the US, and their outlook will be very interesting," he said. "That's going to be a key catalyst for global markets." The United States benchmarks, the S&P 500 and Nasdaq Composite, closed at all-time highs on Monday. Google’s parent company, Alphabet, became the fourth company to reach a US$3 trillion (NZ$5t) market capitalisation.

Channel Infrastructure NZ was a standout on the bourse, gaining 4.7% to $2.45 and adding to its solid year-to-date performance.

In an investor day presentation released to the market, Oceania Healthcare disclosed it expected total unit sales to reach between 265 and 275, or about 3% to 7% higher than the same period last year.  “New care suite sales are strong with new product launches in Redwood, Blenheim and Meadowbank, Auckland,” it said. The retirement village and aged care company, which dipped 0.72% to 68.5 cents, also said it has plans to offload four to six sites, releasing an estimated $30m to $50m.

Similarly, Ryman Healthcare listed a property in Christchurch where the company had been planning to build a high-rise retirement project on Monday. "A bit of a strategy refresh away from the intensified living arrangements that haven't been that popular with residents," Sullivan said. "It's worth noting as well, consents in the sector have dropped off materially." Ryman and the last remaining listed retirement company, Summerset Group, rose 1.62% to $2.51 and 2.41% to $11.03, respectively.

Freightways Group likewise performed well, finishing up 2.17% at $12.70, while Briscoe Group went in the other direction, losing 8.19% to $4.93 on light volumes. Last week, Briscoe tempered profit expectations in its half-year earnings result.

Pacific Edge lost some of Monday's gains, dropping 6.53% to 18.6 cents, but remaining up about 30% for the last five days. Metro and Macro Metro Performance Glass announced it had successfully wrapped up its $23.9m recapitalisation, with a strongly supported rights offer.  The pro-rata renounceable rights offer drew $10.7m in applications, with 67% of shareholders taking up their entitlements and oversubscriptions exceeding the remaining shares by $1.8m. As a result, no shares were required to be taken up by underwriters. Sullivan said it was a company that was "truly in need of some capital". On top of the Fed meeting, Sullivan said local investors will be anticipating the Stats NZ trade balance and gross domestic product (GDP) data releases, set to come out later this week.

Source: Business Desk

Ahead of the local open SPI futures were 40 points lower at 8832.

- close [Morningstar with AAP]: Record overnight results in the United States have paved the way for Australian shares to finish in the green as traders anticipate a critical rates decision.

The S&P/ASX200 ended Tuesday's trading session up 24.7 points, or 0.28 per cent, to 8,877.7, as the broader All Ordinaries gained 30.3 points, or 0.33 per cent, to 9,151.2.

The local market followed Wall Street's lead after it reached fresh highs powered by tech stocks in anticipation the Federal Reserve will cut interest rates, Capital.com senior financial markets analyst Kyle Rodda said.

"Wall Street is rallying into this Fed decision, and it's doing so on the expectation that there will not just be a rate cut, but a guidance towards future rate cuts as well," he told AAP.

"It's pretty much all about the Fed at the moment. We'll count down the minutes until that happens and then react accordingly."

He said the local market had been "far from volatile recently" and any guidance from Fed chair Jerome Powell that failed to match dovish expectations could be the "shock that wakes up the markets".

Eight of 11 local sectors ended the day in positive territory, led by energy and materials while healthcare lagged.

Mining stocks ended trading up 0.7 per cent, as gold stocks benefited from anticipation surrounding the US rates decision, hitting a fresh high of $3689.

Goldminers Northern Star and Evolution Mining both gained 0.5 per cent while Perseus Mining was 1.4 per cent in the green.

Also ahead were the sector's heavyweights; BHP was up 0.5 per cent and Rio Tinto rose 1.9 per cent.

Energy gained 0.9 per cent amid heightened fears of supply disruptions overseas, with coal miner New Hope recording a 5.1 per cent gain despite reporting an eight per cent drop in annual profit.

Healthcare trailed after CSL recorded a 1.3 per cent slump on the announcement of a deal to potentially acquire Dutch biotech company VarmX BV, which is developing a treatment for a deadly side effect of blood thinners.

The Australian biotech giant will make an upfront payment of $US117 million ($A175 million) for the company, weeks after it announced 3000 job cuts and spun off its vaccine arm.

Super Retail Group, which owns Rebel Sport and Supercheap Auto, fired its chief executive and managing director on Tuesday following revelations of an undeclared workplace relationship.

Anthony Heraghty's termination over his relationship with the company's former chief human resources officer led to a 4.3 per cent share price drop, but the controversy didn't spread to the wider consumer discretionary sector which was up 0.8 per cent.

Financial stocks ended the day in the green but recorded mixed results among the big four banks, with Westpac and NAB in positive territory while ANZ and CBA lost ground.

The Australian dollar is buying 66.65 US cents, up from 66.57 US cents on Monday at 5pm.

ON THE ASX:

The S&P/ASX200 rose 24.7 points on Tuesday, or 0.28 per cent, to 8,877.7

The broader All Ordinaries gained 30.3 points, or 0.33 per cent, to 9,151.2

The NZX 50 Lost -33.21 points (-0.25%) to 13201.68

Companies commencing Ex-Dividend Trading Today (ASX 300):

Auckland International Airport Limited

Flight Centre Travel Group Limited

Inghams Group Limited

MAAS Group Holdings Limited

Service Stream Limited

Supply Network Limited

[Morningstar with Dow Jones]:

U.S. stocks ended lower. The DJIA fell 0.3% to 45,757.90, the S&P 500 slipped 0.1% to 6,606.76 and the Nasdaq fell 0.1% to 22,333.96.

Among S&P 500 companies, the top three gainers were APA Corp APA surging 6.98%, Steel Dynamics Inc STLD jumped 6.15%, and Occidental Petroleum Corp OXY lifted 5.04%.

The biggest decliners were Warner Bros. Discovery Inc WBD which dropped 6.22%, Paramount Skydance Corp PSKY fell 5.65%, and Emerson Electric Co EMR lost 4.89%.

Asia

Chinese shares closed mixed. The benchmark Shanghai Composite Index was unchanged at 3,861.87 and the Shenzhen Composite Index rose 0.7% to 2,489.78.

Hong Kong shares ended flat. The benchmark Hang Seng Index was unchanged at 26,438.51.

Japanese shares ended higher. The Nikkei Stock Average climbed 0.3% to 44,902.27.

India shares ended higher. The BSE SENSEX added 0.7% to 82,380.69.

Europe

Stocks in the U.K. finished lower. The FTSE 100 Index fell 0.9% to 9,195.66. In Europe, shares closed lower. The Germany's DAX dropped 1.8% to 23,329.24, and the France's CAC 40 fell 1% to 7,818.22