The lagging New Zealand sharemarket snapped an eight-day losing streak with a small but significant gain – but global marketer a2 Milk continued its slump.
The S&P/NZX 50 Index raced ahead to an intraday high of 12,442.65 by lunchtime but then steadied and closed at 12,410.47, up 42.61 points or 0.34 per cent.
There were 71 gainers and 68 decliners over the whole market on light trading of 33.9 million shares worth $105.15 million.
Greg Smith, head of research with Fat Prophets, said the market had “a bit of a relief bounce after the weakness last week. The inflationary concerns aren’t going away, and it’s a case of the market acclimatising to the prospect of a higher inflation rate and higher interest rates down the track.”
ANZ economists are predicting that the Reserve Bank of New Zealand will begin raising the official cash rate in August next year with gradual but steady increases, and the rate will reach 1.25 per cent by the end of 2023. That would he a (steep) 1 per cent rise from the current 0.25 per cent.
Fallen market darling a2 Milk fell another 27c or 4.48 per cent to $5.76 on the day’s heaviest trade of $15.97m worth of shares. It share price has now fallen two-thirds since late September last year.
Smith said a2 Milk continued to lose altitude. “A lot of issues have been raised, not just the daigou sales channel, but it is still a good business and has a quality brand. It has just fallen out of favour with the market.”
Fisher and Paykel Healthcare kept the market steady with a 58c rise to $33.48; Ebos Group increased 65c or 2.15 per cent to $30.95; Restaurant Brands surged 60c or 4.51 per cent to $13.90; and Skellerup Holdings was up 14c or 3.13 per cent to $4.61.
Summerset Group Holdings rose 24c or 1.94 per cent to $12.59; but other retirement village operators Ryman Healthcare was down 15c to $14.50, and Oceania Healthcare fell 4c or 2.94 per cent to $1.32.
Chorus submitted an annual revenue range of $720m-$820m to the Commerce Commission for the 2022-2024 regulatory period, and its share price increased 6c to $6.31.
Other gainers were Pushpay, up 5c or 3.09 per cent to $1.67; Serko moving 14c or 2.24 per cent to $6.39; Vista Group climbing 12c or 5.71 per cent to $2.22; Kathmandu Holdings picking up 5c or 3.27 per cent to $1.58; and Scales Corporation collecting 13c or 2.96 per cent to $4.52.
Electricity generator and retailer Trustpower picked up 1c to $8.34 after reporting a sound annual result for the year ending March. Trustpower’s revenue slipped 4 per cent to $952.78m; its net profit was down 69 per cent to $30.73m; but its group operating earnings (ebitdaf) grew 7.3 per cent to $2002m.
Trustpower’s retail earnings (ebitdaf) were ahead 33 per cent at $47m, its generation earnings were steady at $154m despite dry conditions, and it announced a welcomed total dividend of 18.5c a share, a 17c final and a catch-up 1.5c special dividend, payable on June 18.
Insurer Tower fell 5c or 5.81 per cent to 81c after downgrading its 2021 net profit to $25m-$27m, from the previous guidance of $298m. Tower said this revision reflected emerging industry trends of inflationary pressures on building costs, as well as higher frequency of house claims.
SkyCity Entertainment has raised $175m through a six-year unsecured bond carrying an interest rate of 3.02 per cent a year, and its share price climbed 1c or to $3.50.
Precinct Properties New Zealand launched a $100m, six-year, fixed rate green bond offer to institutional and retail investors. The margin and interest rate for the offer is expected to be set on May 21. Its share price slipped 0.005c to $1.605.
Other decliners were Fletcher Building, down 6c to $7.28; Genesis Energy falling 9c or 2.56 per cent to $3.43; and NZME shedding 4c or 4.94 per cent to 77c.
Victoria Newman, previously head of new ventures and transformation lead at Noel Leeming, has been appointed the future director for NZX, and its share price rose 6c or 3.02 per cent to $2.05.
T&G Global, which has been operating for 124 years, announced that its chairman Professor Klaus Josef Lutz will be stepping at the annual meeting on June 23. T&G’s share price was unchanged at $2.91.
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