Market Announcements
Market Summary
The New Zealand sharemarket hit a new all-time high with a late rise, but the continuing oil price rise is creating further uncertainty over the direction of inflation and interest rates. In a choppy session, the S&P/NZX 50 Index fell to an afternoon low of 13,720.26 before climbing back and closing at 13,795.31, up 32.13 points or 0.23%. There were 70 gainers and 62 decliners on the main board of 179 stocks, and turnover reached 39.5 million shares worth $148m.
Jeremy Sullivan, investment adviser with Hamilton Hindin Greene, said, “The local market has been more resilient to the volatility we’ve seen offshore, especially in Asia.” He said rising oil prices increase inflation and interest rates, and are not good for equities. The continued action in the Middle East is doing its best to harm the sharemarkets. “Wholesale interest rates have risen 10% in the past three weeks. They are pseudo doing the work for the Reserve Bank by increasing borrowing rates, and you’d expect mortgage rates to tick up, if they haven’t already done so,” said Sullivan.
Brent Crude oil was trading at a near seven-week high of US$95.95 (NZ$164.86) a barrel at 6pm NZ time – just below the US$96 mark on June 2 after falling to a low of US$71.99 on June 27. The oil price rise has coincided with the escalating Middle East tensions, including tanker disruptions in the Hormuz Strait and Red Sea and US President Donald Trump’s threats of military action against Iranian infrastructure. Iran-backed Houthi militants attacked two Saudi oil tankers in the Red Sea, marking the first direct strikes on tankers in the waterway and raising concerns over a key alternative export route for Saudi crude.
On Wall Street, the Dow Jones Industrial Average was steady at 52,218.58 points, the S&P 500 was down 0.14% to 7,498.906, and the Nasdaq Composite declined 0.57% to 25,690.9. Alphabet, owner of Google, was down 1.24% to US$341.91 after reporting higher-than-expected annual capex of US$205 billion to meet AI demand. Its cloud business recorded more than $24b in the second quarter, and net profit tripled to more than $112b. Tesla decreased 1.3% to US$374.01, falling 17% so far this year, after increasing quarterly revenue to $28.24b but missing on earnings per share of 33c, down from an expected 51c.
At home, Meridian Energy was up 10c or 1.76% to $5.77; Freightways rose 45c or 3.24% to $14.35; Summerset increased 17c or 2.09% to $8.31; and Skellerup collected 12c or 1.81% to $6.75. Hallenstein Glasson gained 29c or 2.82% to $10.59; Channel Infrastructure was up 15c or 4.59% to $3.42; Foley Wines added 1.5c or 3.16% to 49c; and Promisia Healthcare rose 5c or 8.33% to 65c. Ebos Group decreased 20c to $21.90; a2 Milk eased 14c to $8.39; Napier Port was down 10c or 2.68% to $3.63; Gentrack fell 19c or 5.19% to $3.47; and Winton Land declined 4c or 3.33% to $1.16. Bremworth shed 3c or 4.17% to 69c; Oceania Healthcare was down 1.5c or 1.95% to 75.5; and Michael Hill decreased 1.5c or 3.80% to 38c.
Genesis Energy, migrating to a single brand and simplified product offering, was down 2c to $2.58 after telling the market that financial outcomes for the June quarter were at the lower end of expectations because of warmer-than-forecast temperatures. The gross margin for electricity increased an expected 11.6% to $189 per megawatt-hour (MWH), customers were down 5.8% to 490,227, electricity sales decreased 153GWH to 1543GWh, hydro generation was steady at 703GWh, and thermal generation declined 567GWh to 527GWh. Mercury Energy, unchanged at $6.79, is investing $53m for a 12.7% stake in Datagrid Holding Group NZ, which is developing a 360MW data centre at North Makarewa, north of Invercargill. Mercury signed a 140MW power purchase option agreement with Datagrid in March.
Tourism Holdings was up 1c to $2.87 after upgrading its full-year underlying net profit to about $46m, from $40m-$43m, because of strong late bookings – US was up 50% in recent weeks – and vehicle sales in NZ at the higher end of expectations. Spark, up 2c to $1.87, has appointed Tommy Bjorkberg, vice-president network and cloud at KPN in the Netherlands, as the new chief operating officer, starting on Oct 1. Logistics software firm Locate Technologies, unchanged at 4.4c, reported its Locate2u division reached $1.2m in revenue at the end of the June quarter, up 54% for the year. Group revenue was up 29% to $1.95m. Operating earnings (ebitda) for the quarter was a loss of $515,000, driven by a revaluation of its 12.3 Bitcoin holdings, which fell from $1.78m to $1.27m. Locate has $1.16m cash, down from $1.95m a year earlier.
Source: Business Desk
Australian Market Report
Ahead of the local open SPI futures were 57 points lower at 8795.
- close [Morningstar with AAP]: Australian shares have reversed most of the session's gains after hotter-than-expected jobs figures and energy supply worries heightened the odds of higher interest rates.
The S&P/ASX200 gained 16 points on Thursday, up 0.18 per cent, to 8,839, as the broader All Ordinaries rose 13.2 points, or 0.15 per cent, to 9,018.1.
Australia's leading index crumbled from a more than 100-point lead earlier in the day after June jobs numbers smashed expectations with employment rising by 76,300.
The surprise prompted interest rate markets to tip another hike before years-end, which would take the cash rate to 4.6 per cent.
"The ASX200 got out hard and early, up 103 points, hit that five week high of 8,926.3 and then after springing out of the gates, we ran into an electric fence in the shape of that red hot June's jobs report," IG analyst Tony Sycamore told AAP.
"And on top of that 26 per cent rise in oil prices we've seen this month, the RBA is definitely back with its hand hanging over the rate hike button for its August 11th board meeting."
Mining stocks charged for a third session as copper and gold stocks rallied on stronger commodity prices, while oil clung to recent gains as Iran-backed Houthis in Yemen claimed to strike two tankers in the Red Sea, stoking inflation fears.
The energy sector traded one per cent higher, led by uranium stocks as they recovered from recent weakness on the back of several positive production reports.
Refinery operators Viva and Ampol were flat by the close, while Woodside gained 0.5 per cent to $31.80, and Santos traded at break-even after its second quarter update failed to impress.
BHP shares improved 1.5 per cent to $60.63, while South32 added an extra 2.4 per cent on Thursday, taking its gains for the week to almost 20 per cent.
Gold stocks advanced despite the precious metal coming off the boil from its recent rebound to trade at $US4,123 ($A5,879) an ounce.
The heavyweight financials sector inched higher as NAB led the big four banks higher with a 1.3 per cent improvement to $39.81, while CommBank trailed the pack with a 0.4 per cent lift to $172.30.
In company news, Macquarie chief executive Shemara Wikramanayake announced her retirement after eight years in the top job, with banking and financial services boss Greg Ward to take over at the so-called "millionaire factory" in November.
Origin confirmed a significant data breach, after a third party accessed an unknown number of customers' personal data, including names, addresses, birth dates and incomplete credit card or bank details.
The Australian dollar is buying 70.05 US cents, up from 69.95 US cents on Wednesday at 5pm AEST.
ON THE ASX:
The S&P/ASX200 rose 16 points, or 0.18 per cent, to 8,839
The broader All Ordinaries gained 13.2 points, or 0.15 per cent, to 9,018.1
The NZX 50 Lost -37.79 points (-0.27%) to 13757.52
Overseas Market Report
[Morningstar with Dow Jones]:
U.S. stocks ended lower. The DJIA dropped 1% to 51,711.65, the S&P 500 declined 1.2% to 7,408.30 and the Nasdaq fell 2.2% to 25,137.69.
Among S&P 500 companies, the top three gainers were Lockheed Martin Corp LMT surging 10.54%, Allegion PLC ALLE jumped 10.45%, and United Rentals Inc URI lifted 10.11%.
The biggest decliners were Tesla Inc TSLA which dropped 14.66%, T-Mobile US Inc TMUS fell 10.75%, and Rollins Inc ROL lost 9.27%.
Asia
Chinese shares closed higher. The benchmark Shanghai Composite Index added 0.3% to 3,876.78 and the Shenzhen Composite Index lifted 0.9% to 2,483.17.
Hong Kong shares ended higher. The benchmark Hang Seng Index added 1.3% to 25,210.81.
Japanese shares ended higher. The Nikkei Stock Average gained 0.5% to 66,422.60.
India shares ended lower. The BSE SENSEX declined 0.5% to 76,391.39.
Europe
Stocks in the U.K. finished lower. The FTSE 100 Index dropped 0.7% to 10,639.17. In Europe, shares closed lower. The Germany's DAX slipped 1.6% to 24,763.12, and the France's CAC 40 declined 1.6% to 8,299.09
