NZ Sharemarket Flat, Down 0.25%

The New Zealand sharemarket surprisingly bucked the trend yesterday, falling on the day the long-awaited peace agreement between the United States and Iran was announced. While other Asia-Pacific markets were rising, the S&P/NZX 50 Index slipped during the afternoon and closed at 13,360.59, down 33.28 points or 0.25% after reaching an intraday high of 13,526.07. There were 92 gainers and 42 decliners on the main board with 62 million shares worth $169.5m changing hands.

US President Donald Trump announced on social media that the deal with Iran was now complete, and Pakistani Prime Minister Shehbaz Sharif said an official signing ceremony would take place on Friday in Switzerland. The agreement sent oil prices tumbling well under US$90 (NZ$153.67), with Brent Crude trading at US$83.58 a barrel, a fall of nearly 5%. Across the Tasman, the S&P/ASX 200 Index had gained 1.29% to 8,917.50 points at 6pm NZ time, and, further afield, the Japanese Nikkei 225 had risen 4.69%, the South Korean Kospi 5.18%, the Taiwanese Taiex 2.78%, and the Hong Kong Hang Seng was up 0.48%. Wall Street had finished the week on a high after the successful listing of SpaceX, which rose 19.22% to US$160.95 from the initial public offering price of US$135, surpassing US$2 trillion in market capitalisation.

At home, the market was driven down by Fisher & Paykel Healthcare, which fell $1.29, or 3.27%, to $38.16 on trade worth $13.85m. Ebos Group was down 36c to $21.05. The energy sector was weaker, with Meridian declining 15c, or 2.52%, to $5.80; Mercury down 13c, or 1.87%, to $6.83; and Contact easing 13c to $9.42. Meridian told the market that consistent inflows and careful management of the southern hydro lakes have eliminated the risk of a significant drought this winter. In the month of June 8, national hydro storage increased from 119% to 125% of the historical average. South Island storage increased to 120% of average, and North Island decreased to 160% of average. Meridian’s customer connection numbers decreased by 0.8% in May but have increased by 14.3% over the last 12 months. Retail sales volumes last month were 7.8% higher than in May last year.

Infratil was up 14c to $14.95; a2 Milk gained 9c to $7.36; Mainfreight added 60c to $66; and Briscoe increased 18c or 3.9% to $4.79.

Airline stocks rose on hopes of lower fuel costs. Air NZ was up 3.5c or 8.33% to 45.5c; Auckland International Airport gained 21c or 2.55% to $8.44; and Qantas had risen 5.83% to A$9.895 on the ASX 200. The airport company reported a 1% drop in total passengers to 1.41m. Domestic passengers were steady at 666,386, while international passengers were down 2% to 745,889, although Chinese nationals rose 10%.

Retirement village operator Summerset rose 40c, or 4.88%, to $8.59.

Sanford, another beneficiary of lower fuel costs, was up 19c or 2.71% to $7.20; SkyCity rose 2c or 4.3% to 48.5c; Serko gained 7.5c or 4.78% to $1.64; Gentrack recovered 9c or 2.45% to $3.77; and Scales Corp added 15c or 2.46% to $6.25.

Heartland Group, down 0.0005c to $1.23, said the merger with TSB Bank was on track to be completed in December after due diligence was successfully completed. Heartland is buying all the TSB shares from the Toi Foundation.

Oceania Healthcare, unchanged at 74c, is planning a six-year fixed-rate bond offering, with full details to be released next week.

Source: Business Desk

Ahead of the local open SPI futures were 98 points lower at 8827.

- close [Morningstar with AAP]: Australia's share market has notched its best two-session performance since April following reports the US and Iran have agreed on the terms of a peace deal.

The S&P/ASX200 jumped 110 points on Monday, up 1.25 per cent, to 8,914, as the broader All Ordinaries gained 121.9 points, or 1.35 per cent, to 9,128.

The memorandum of understanding - expected to be signed by US and Iranian officials in Switzerland on Friday - reportedly includes a 60-day ceasefire extension, the Hormuz Strait reopened within 30 days, and commitments to discuss Iranian sanctions and frozen funds.

Oil prices slumped to 14-week lows, launching most cyclical sectors higher as investors repriced the Persian Gulf conflict's likely global economic impact.

"With oil prices retreating by five per cent and fears of a prolonged energy shock easing, Australian energy stocks bore the brunt of the reversal," Global X senior product and investment strategist Marc Jocum said.

Santos and Karoon Energy dived more than eight per cent each, while Woodside fell 5.7 per cent after denying rumours it was in talks to be scooped up by Exxon.

Local refinery operators Ampol and Viva fell between five and seven per cent, both dipping from recent peaks but still up more than 17 per cent compared to their pre-conflict share prices.

"Elsewhere, animal spirits returned with over 70 per cent of the S&P/ASX 200 stocks finishing in the green in an overwhelmingly risk-on move," Mr Jocum said.

Basic materials, real estate trusts and financials led the move higher, while gold miners shone brightly atop the S&P/ASX200 leaderboard as the precious metal rebounded above $US4,310 ($A6,092) an ounce.

Iron ore and copper giants BHP and Rio Tinto gained more than three and two per cent, respectively, as base metals improved during the session.

Airlines also outperformed, with Virgin Australia shares soaring 12.5 per cent and Qantas up more than six per cent to $9.94 at the prospect of cheaper jet fuel and fewer disruptions for Virgin's Middle East direct flights.

The traditionally defensive consumer staples and utilities sectors fell 0.8 per cent and 1.8 per cent, respectively, as investors unwound some of their recent positioning.

In company news, Chemist Warehouse owner Sigma Healthcare surged six per cent after it scrapped plans to buy UK beauty and pharmacy chain Boots.

The Australian dollar is buying 70.75 US cents, up from 70.33 US cents on Friday at 5pm, buoyed by stronger base metal prices and an easing of the safe-haven greenback.

Ahead of the Reserve Bank's June meeting on Tuesday, markets expected the central bank would hold the cash rate steady at 4.35 per cent, IG market analyst Tony Sycamore said.

"Attention will instead centre on the accompanying statement which is expected to sound hawkish and Governor (Michele) Bullock's press conference for any hints around the likelihood of further tightening later in the year."

ON THE ASX:

The S&P/ASX200 gained 110 points, or 1.25 per cent, to 8,914

The broader All Ordinaries rose by 121.9 points, or 1.35 per cent, to 9,128

The NZX 50 added 16.56 points (0.12%) to 13377.15

[Morningstar with Dow Jones]:

U.S. stocks ended higher. The DJIA lifted 0.9% to 51,671.03, the S&P 500 rose 1.7% to 7,554.29 and the Nasdaq added 3.1% to 26,683.94.

Among S&P 500 companies, the top three gainers were Western Digital Corp WDC surging 16.09%, DoorDash Inc DASH jumped 11.62%, and Micron Technology Inc MU lifted 10.83%.

The biggest decliners were Fox Corp FOXA which dropped 16.84%, Fox Corp FOX fell 15.22%, and Truist Financial Corp TFC lost 6.16%.

Asia

Chinese shares closed higher. The benchmark Shanghai Composite Index added 1.6% to 4,096.47 and the Shenzhen Composite Index climbed 3.4% to 2,789.36.

Hong Kong shares ended higher. The benchmark Hang Seng Index lifted 0.5% to 24,842.67.

Japanese shares ended higher. The Nikkei Stock Average climbed 5% to 69,317.50.

India shares ended higher. The BSE SENSEX gained 1% to 76,264.33.

Europe

Stocks in the U.K. finished lower. The FTSE 100 Index fell 0.4% to 10,430.62. In Europe, shares closed higher. The Germany's DAX lifted 1.1% to 24,894.01, and the France's CAC 40 added 0.4% to 8,384.01