Market Announcements
Market Summary
The New Zealand sharemarket fell slightly on Budget Day, while Mainfreight had a sharp rise even though it wasn’t happy with its annual financial result. The S&P/NZX 50 Index peaked at lunchtime yesterday at 13,310.5 but began sliding as the Budget was announced, closing at 13,206.11, down 27.10 points, or 0.16%. There were 88 decliners and 45 gainers on the main board with 52.7 million shares worth $198.2m changing hands.
Just like the Budget, Mainfreight’s full-year earnings were steady as she goes. The global transport and logistics company increased $3.95 or 6.37% to $62.60 after reporting a 2.8% gain in full-year revenue to $5.38 billion and 8.5% fall in net profit to $251m. Mainfreight, which is paying a final dividend of 87c a share on July 17, said it was disappointing not to improve the profitability from last year, but “we remain satisfied with the level of improvement during the second six months (of the year).” Trading in April and May has been encouraging, despite disruption and uncertainty caused by the Middle East conflict and elevated fuel pricing. Mainfreight’s NZ business contributed $1.2b revenue, up 3.8%, and profit before tax of $120.8m, down 10.2%; and Australia A$1.51b (NZ$1.8b), up 0.2%, and A$152.6m, a gain of 11.1%.
Jeremy Sullivan, investment adviser with Hamilton Hindin Greene, said Mainfreight had been sold off consistently this year, and the market was expecting a weaker result, with fuel costs having a material impact. But the company provided a positive outlook, and its share price was back to its mid-March level. “It has confidence in ongoing improvements to its network and controlling the controllables.” Sullivan said, “There wasn’t a huge amount of headlines” for business in the Budget. But investors welcomed the move to increase the tax threshold for Foreign Investment Funds to $100,000, from $50,000. “This will be good for capital markets.” He said the return to surplus a year earlier would benefit NZ Inc and credit agencies’ outlooks for NZ, helping the Government’s long-term borrowing. “It will increase our international standing as a sound place to invest.” Finance Minister Nicola Willis said NZ would have a $2.6b surplus in 2028/29 – the first surplus in a decade and an improvement on the $900m deficit forecast by the Treasury in December. The Budget slapped a new levy on banks, insurers and other financial market participants to help pay for their regulation, costing them about $209m over four years and paid to the Reserve Bank.
ANZ Bank was down $1.06 or 2.45% to $42.28; Westpac decreased 47c to $43.53; and Heartland Group was up 2c or 1.8% to $1.13. Infratil eased 13c to $15.87 on trade worth $25.29m; Ebos Group was down 32c to $19.51; a2 Milk declined 14c or 2.05% to $6.69; Fletcher Building decreased 8c or 2.52% to $3.10; and Serko shed 7.5c or 4.48% to $1.60. Vista Group increased 11c or 4.38% to $2.62; Napier Port gained 13c or 3.58% to $3.76; Winton Land was up 4c or 2.41% to $1.70; Tourism Holdings rose 9c or 4.27% to $2.20; and Eroad improved 4c or 4.231% to 99c.
Dairy giant Fonterra reported third-quarter operating profit of $1.8b, up $103m, and an increased earnings per share of 57c, up from 53c compared with the same period last year. The full-year forecast earnings range was lifted to 60-70c a share, up from 50-65c. Fonterra forecast a farmgate milk price of $9.75 per kgMS for the 2026/27 season and narrowed the present season’s payment to $9.60-$9.80 with an unchanged mid-point of $9.70. Fonterra Shareholders’ Fund increased 23c or 3.3% to $7.20, and Fonterra Co-operative was up 5c to $4.45.
Digital data firm Blackpearl Group fell 7c or 8.92% to 71.5c after reporting a 77% rise in full-year revenue to $13.7m and a net loss of $17.8m. Annual recurring revenue was $26.8m, up 114%, and subscription revenue was $13.7m, up 77%. The AI model Pearl Engine processes 31 billion data signals daily for customers’ marketing solutions, and the company now says its growth case is proven.
Promisia Healthcare, gaining 6c or 11.11% to 60c, reported a 34% in revenue to $51.77m; 58% improvement in operating earnings (ebitdaf) to $6.6m, and 89% rise in net profit to $12.92m for the 12 months ending March. Occupancy at Promisia’s five aged care facilities increased from 87% to 94%, and their market valuation grew from $15.7m to $107.2m. Promisia is forecasting ebitdaf of at least $8m in the 2027 financial year. TruScreen, up 0.001c or 5.26% to 2c, has appointed Albatros Health Care as its distributor in Uzbekistan, with sales revenue potential of $1.26m and is about to start a clinical study in Tashkent.
Source: Business Day
Australian Market Report
Ahead of the local open SPI futures were 38 points lower at 8703.
- close [Morningstar with AAP]: Australia's share market has improved after cooler than expected inflation data took the pressure of the Reserve Bank to hike the interest rate for a fourth straight meeting.
The S&P/ASX200 rose 59.9 points on Wednesday, up 0.69 per cent, to 8,717.7, as the broader All Ordinaries jumped by 62.5 points, or 0.7 per cent, to 8,945.1.
Interest rate-sensitive stocks led the gains after an unexpected dip in April headline inflation and a soft jobs report last week likely gave the RBA room hold the cash rate steady at 4.35 per cent at its June meeting.
"Technology was the stand-out sector today, leading the gains as investors rotated back into one of the market's most rate-sensitive corners," Vantage senior market analyst Hebe Chen told AAP.
However, with the impacts of the Middle East energy crisis still filtering through the economy and the US-Iran conflict soon entering a fourth month, upside risks to price growth remain.
"Beyond the domestic picture, US inflation data, global bond yield stress and geopolitical uncertainty around the Iran ceasefire could still remind investors that the risks have not fully cleared," Ms Chen said.
The heavyweight financials sector turned around an early slump to end the session 0.1 per cent higher, with broad-based strength counterbalancing weakness in three of the big four banks.
Bourse operator ASX Ltd was heavy, dropping by almost 10 per cent to a nine-year low, a day after flagging higher spending expected next financial year.
Basic materials stocks had a solid day, led by a 1.5 per cent boost to BHP shares to a fresh record close of $61.28, while South32, Lynas Rare Earths and James Hardie also posted strong gains.
Gold stocks were mixed, as the precious metal eased to $US4,484 ($A6,272) an ounce.
The energy sector advanced 0.4 per cent despite oil prices edging lower during the session, with Woodside, Santos, Ampol and Viva sluggish as coal producers and uranium stocks improved.
Consumer cyclicals rocketed 1.8 per cent higher in a broad-based rally fuelled by tempering rate hike expectations.
The sector is on track for a third week of gains after its value tumbled by more than a quarter since October.
Real estate stocks also benefited from the cooler inflation print, rallying 1.6 per cent with an outsized boost for segment giant Goodman Group, a day after its third quarter operational update failed to make a major impression.
In company news, Southern Cross Media shares soared more than seven per cent higher after Gina Rinehart emerged as a major shareholder, after financially backing Bruce McWilliam's nine per cent stake in the company.
Nufarm shares rocketed almost 14 per cent to a one-year high after growing its first-half net profit by more than a quarter to $38 million, while flagging a capital expenditure decrease of $46 million to $200 million for the current financial year.
The Australian dollar is buying 71.46 US cents, down slightly from 71.65 US cents on Tuesday at 5pm.
ON THE ASX:
The S&P/ASX200 rose 59.9 points, or 0.69 per cent, to 8,717.7
The broader All Ordinaries gained 62.6 points, or 0.7 per cent, to 8,945.2
The NZX 50 added 40.93 points (0.31%) to 13268.74
Companies Holding Annual General Meeting (ASX 300):
Gemlife Communities Group
Yancoal Australia Limited
Companies commencing Ex-Dividend Trading Today (ASX 300):
Technology One Limited
Overseas Market Report
[Morningstar with Dow Jones]:
U.S. stocks ended mixed. The DJIA rose 0.4% to 50,644.28, the S&P 500 was unchanged at 7,520.36 and the Nasdaq climbed 0.1% to 26,674.74.
Among S&P 500 companies, the top three gainers were AppLovin Corp APP surging 10.46%, MGM Resorts International MGM jumped 9.06%, and United Airlines Holdings Inc UAL lifted 6.30%.
The biggest decliners were Boston Scientific Corp BSX which dropped 12.50%, Qualcomm Inc QCOM fell 6.16%, and Skyworks Solutions Inc SWKS lost 5.65%.
Asia
Chinese shares closed lower. The benchmark Shanghai Composite Index dropped 1.2% to 4,093.73 and the Shenzhen Composite Index declined 1.3% to 2,834.85.
Hong Kong shares ended lower. The benchmark Hang Seng Index fell 1.1% to 25,328.23.
Japanese shares ended flat. The Nikkei Stock Average was unchanged at 64,999.41.
India shares ended lower. The BSE SENSEX slipped 0.2% to 75,867.80.
Europe
Stocks in the U.K. finished higher. The FTSE 100 Index lifted 0.1% to 10,505.01. In Europe, shares closed mixed. The Germany's DAX was unchanged at 25,177.80, and the France's CAC 40 gained 0.4% to 8,207.89
