Market Announcements
Market Summary
Blue-chip stocks drove the New Zealand sharemarket down nearly 1% yesterdayas concerns about an economic slowdown increased. The S&P/NZX 50 Index dipped sharply at noon and closed at 13,080.33, down 130.15 points or 0.99%. There were 73 decliners and 66 gainers on the main board with volumes reaching 31.8 million shares worth $168.9m.
“The market wasn’t too happy today,” Jeremy Sullivan, investment adviser with Hamilton Hindin Greene, said. “There was profit-taking in Infratil, Fisher and Paykel Healthcare led the index lower, and a2 Milk continued to drift after a broker downgrade.” The April ANZ Truckometer showed the Light Traffic Index was down 1.7% (up 2.4% for the year), and Heavy Traffic declined 1.2% (up 2.4% year-on-year). ANZ said light traffic (motorbikes, cars and vans) is generally a good indicator of demand and typically provides up to a six-month lead on economic momentum. “Light traffic has dropped markedly in the last couple of months, likely reflecting people choosing to drive less as a result of higher fuel prices.” In another report, ANZ said the (NZ) Budget on May 28 will not be easy. “The oil supply shocks put policy makers between a rock and a hard place – choose between containing the medium-term inflation implications or containing the fallout in activity and employment. In aggregate, you can’t do both. “While tax increases appear unlikely, some degree of spending restraint remains a possibility.” ANZ said households and businesses face significant uncertainty and balance‑sheet pressure, but the Government needs to be selective in its support if it is to avoid exacerbating the inflation pain and pushing fiscal settings further towards unsustainable territory.
In the US, President Donald Trump warned the ceasefire in the Middle East conflict was on "life support" after rejecting the latest counteroffer from Iran, which said its military stood ready to respond to any act of aggression. Brent Crude oil was steady at US$105.10 (NZ$176.47) a barrel. Wall Street remained reasonably positive. Across the Tasman, the S&P/ASX 200 Index was down 0.31% to 8674.40 points (at 6pm NZ time) while it waited for the Federal Budget that was expected to reveal new investment tax rules on housing.
At home, Fisher and Paykel Healthcare fell to its lowest level in more than a year after declining $1.02 or 2.89% to $34.28 on trade worth $23.04m, and Infratil shed 35c or 2.23% to $15.38 on trade worth $24.06m. Infant milk supplier a2 Milk declined 35c or 4.35% to $7.70 after Australian broker Bell Potter trimmed its target price to A$6.75 (NZ$8.19). Ebos Group was near a seven-year low after falling 40c or 1.88% to $20.85; Chorus decreased 17c to $10.08; and ANZ Bank declined 80c or 1.84% to $42.70. In the energy sector, Meridian was down 5c to $5.80; Contact shed 17c or 1.73% to $9.63; and Mercury was up 5c to $6.90. SkyCity hit an all-time low after a further fall of 2.5c or 3.97% to 60.5c; Heartland Group shed 2.5c or 2.2% to $1.11; and Blackpearl Group was down 1.5c or 2.;04% to 72c.
In the property sector, Stride decreased 2c or 2.19% to $1.11, and Kiwi was up 2.5c or 2.65% to 97c. Property for Industry, up 4c to $2.38, upgraded its full-year 2026 guidance of 9.5c a share in cash dividends, a 10.5% increase on its previous year’s dividends. Freightways gained 10c to $13; Vulcan Steel increased 22c or 3.52% to $6.47; and Hallenstein Glasson was up 15c to $10.45.
AoFrio, which supplies energy-efficient motors to the food and beverage industry, increased 0.008c or 11.43% to 7.8c, and miner Manuka Resources was up 0.004c or 3.77% to 11c. Manuka honey supplier Comvita was up 4c or 5.63% to 75c after completing its $40.5m capital raise, enabling the company to repay existing bank loans and activate its refinancing package. More than half of the money was raised when 69% of shareholders exercised their rights under the rights offer. Fraser and Neave took up the shortfall of 12.8m shares worth $8.3m, as well as accepted a placement of 13.2m shares at 80c a share to maintain its 19.9% shareholding in Comvita. New Talisman Gold Mines, down 0.002c or 13.33% to 1.3c, reported that ongoing geological modelling has confirmed under-explored areas and identified multiple mineralised structures, reinforcing the exploration potential of the Talisman project.
Source: Business Desk
Australian Market Report
Ahead of the local open SPI futures were 38 points lower at 8624.
- close [Morningstar with AAP]: Australia's share market has wobbled ahead of the federal budget, as investors brace for tax reforms expected to impact returns on housing and stocks.
The S&P/ASX200 fell 31.1 points on Tuesday, down 0.36 per cent, to 8,670.7, as the broader All Ordinaries dipped by 32.8 points, or 0.37 per cent, to 8,909.6.
Concerns over proposed capital gains tax and negative gearing changes have dragged on real estate and banking stocks, while basic materials carved out some gains on the back of higher commodity prices, catapulting BHP to a new all-time high.
"Residential mortgages make up approximately 45 to 50 per cent of the big four's asset book, so they're very, very heavily exposed to the Australian housing market," IG market analyst Tony Sycamore told AAP.
"So any changes in tonight's budget that lead to a sustained fall of property prices isn't a particularly good thing for banks, their profitability and their ability to provide credit."
The heavyweight financial sector fell to a six-week low as all big four banks sold off ahead of CommBank's third quarter trading update due on Wednesday.
"And if it follows the script that we've seen from the other banks, it's not going to be particularly flash," Mr Sycamore said.
ASX-listed utilities stocks advanced, while energy stocks were weighed down by coal and uranium producers as oil prices rose amid reports of deteriorating US-Iran relations, weighing on hopes of a solution to the Persian Gulf energy crisis.
Woodside and Santos made gains, as the latter took its final investment decision (FID) to build a 19km pipeline to link its Agogo production facility to its PNG LNG pipeline in Papua New Guinea.
Recent strength in iron ore and copper prices helped launch BHP shares to a record high of $60.23, as competitors Rio Tinto and Fortescue also locked in solid gains.
The All Ordinaries gold sub-index jumped more than three per cent, despite the precious metal easing to $US4,700 ($A6,510) an ounce.
Consumer-facing stocks were under pressure, with both the staples and discretionaries sectors shedding more than 1.8 per cent, as higher interest rates, inflation and fuel prices weighing on spending expectations.
The health care segment fell to its lowest close since October 2017, as biotechnology company CSL continued its slide after Monday's gloomy trading update.
In company news, Droneshield shares plunged by almost a tenth after ASIC launched an investigation into the reannouncement of an existing contract and the subsequent sale of almost $70 million in stock by the company's former leaders.
Insurance Australia Group offered limited relief to the battered financial sector, gaining almost two per cent as it outlined its strategy for the rest of the decade.
Australia's exchange traded fund (ETF) industry as reached a record $346 billion in value after its third-largest monthly gain in history, according to Betashares.
International equities accounted for almost half of all ETF inflows at $2.6 billion, with Australian equities ($1.5 billion) and fixed income funds ($1 billion) following behind.
The Australian dollar is buying 72.12 US cents, down from 72.38 US cents on Monday at 5pm.
ON THE ASX:
The S&P/ASX200 dropped 31.1 points, or 0.36 per cent, to 8,670.7
The broader All Ordinaries fell 32.8 points, or 0.37 per cent, to 8,909.6
The NZX 50 Lost -4.61 points (-0.04%) to 13075.72
Companies commencing Ex-Dividend Trading Today (ASX 300):
ResMed Inc.
Overseas Market Report
[Morningstar with Dow Jones]:
U.S. stocks ended mixed. The DJIA rose 0.1% to 49,760.56, the S&P 500 fell 0.2% to 7,400.96 and the Nasdaq dropped 0.7% to 26,088.20.
Among S&P 500 companies, the top three gainers were Zebra Technologies Corp ZBRA surging 11.56%, Qnity Electronics Inc Q jumped 9.87%, and Humana Inc HUM lifted 7.70%.
The biggest decliners were Qualcomm Inc QCOM which dropped 11.43%, Intel Corp INTC fell 6.84%, and SanDisk Corp SNDK lost 6.18%.
Asia
Chinese shares closed lower. The benchmark Shanghai Composite Index fell 0.2% to 4,214.49 and the Shenzhen Composite Index slipped 0.6% to 2,903.98.
Hong Kong shares ended lower. The benchmark Hang Seng Index declined 0.2% to 26,347.91.
Japanese shares ended higher. The Nikkei Stock Average rose 0.5% to 62,742.57.
India shares ended lower. The BSE SENSEX declined 1.9% to 74,559.24.
Europe
Stocks in the U.K. finished flat. The FTSE 100 Index was unchanged at 10,265.32. In Europe, shares closed lower. The Germany's DAX dropped 1.6% to 23,954.93, and the France's CAC 40 fell 0.9% to 7,979.92
