MARKET WRAP: NZ shares fall as US-NK summit kicks off

Hamilton Hindin Greene investment adviser Grant Davies says Stanners exit drove wins for Spark and Sky TV

Hamilton Hindin Greene investment adviser Grant Davies talks through the day on the markets.

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New Zealand shares fell slightly today, as investors and the world watched the unprecedented meeting between North Korean and American leaders unfold in Singapore.

The NZX50 index rose one point to 8,958.81 on turnover of $137 million.

“Today’s one of those quiet days. Perhaps some of the investors were a little bit distracted with what’s going on in Singapore with Donald Trump and Kim Jong Un having their historic there,” says Hamilton Hindin Green investment adviser Grant Davies.

President Trump today says he expects a “signing” to come out of his meeting with the North Korean leader.

“I suppose the market will be cautiously optimistic and we’ll wait to see what happens in terms of action,” Mr Davies says.

A2 Milk tumbled 7c to $11.78 while its supplier Synlait Milk fell 11c to $10.78.

Vodafone New Zealand's longstanding chief executive, Russell Stanners, today confirmed his departure and October replacement in Spark alumnus Jason Paris.

Vodafone is not an NZX listed company but Mr Davies says the departure led gains for Spark and Sky TV. Spark rose 2c to $3.74 while Sky TV jumped 7c to $2.47.

Ryman Healthcare was down 20c to $12.05 while Orion Health fell 1c, or 1.23%, to 80c.

Telstra fell 10c to $3. Eroad jumped 11c to $3.60.

Over on the ASX, Xero was up $A1.05 to $A45 as of 5pm NZST.

Mr Davies says “big macro events” with announcements from the European Central Bank, US Federal Reserve and Bank of Japan across Thursday and Friday will drive investments this week.

“We’ve just been through a period of micro events with the reporting season of May and most of the companies reported in that period had pretty good results, so now we’re taking a step back and taking a look at that bigger picture.”

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1 Comment & Question

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I have 20 Questions.
1. Ready for FIFA World Cup insomnia, or is your training for it peaking nicely?
2. If Brian Gaynor is right
about lack of transparency of NZX trading (>57% crossed in-house) what does that say for the true cashed up value of all Kiwisavers' funds heavily invested in those stocks?
3. Is a market controlled by 8 brokers who do not and, possibly cannot, expose large orders to the electronic quotation system, a cartel?
4. If so, are the annually self congratulatory penguin suited financial "gurus", who make easy money from fees charged to ever increasing sized funds, based on relentlessly upward NZX price trends, part of it?
5. Was David Lange the last PM or deputy, before Winston yesterday in Parliament, who pointed to a record NZX index as a marker of Government performance?
6. Was that around 1987 when the big numbers on the chalkboarded stocks changed (downwards)? [but at least you had an open out cry system, allbeit on a bloodbath floor]
7. Or do you prefer whose Economic Confidence Model picked that '87 crash, and more recently Brexit, and the worldwide changing of governments, and their model says we are all ok until 2032 when all this has the mother of all crashes?
8. Isn't that exactly the time when NZ Super starts disinvesting and cashing up to top up the Super bubble outgoings?
9. Is this year's budget is correct, and there has actually been massive underinvestment in the assets which deliver core Government services?
10. If so, when was the last time actually we made a real surplus?
11. When the Donald has sorted out Korea, will he move on to addressing this not insignificant problem inherited from Obama and Wall St ?
12. Back to Gaynor, is the lack of any true exposed market depth part of the reason CBL got to a market cap of $750m in the first place?
13. Or will this be a feature of the illiquid, yet upward, market from here on, one minute you have something very large and next minute zero?
14. Are the CBL auditors to blame somewhere in here, or should RBNZ have sent them a txt?
15. Is the price discovery available on Tegel (TGH) shares equally uninformative for all the same reasons discussed above?
16. Or will one of the penguins at one of the funds grow some balls and take a blocking 10% stake in TGH that the minority chooks can safely flock around?
17. Will post partial takeover illiquidity in TGH be a problem, or just no worse than it is now?
18. Why do brokers talk about long term earnings growth when floating a stock, and focus only on the immediate next 12 months results in a takeover discussion?
19. Would Aussie buyers get more involved in NZX markets if decent volumes of NZX listed stocks were quoted openly on the buy and sell sides, even if it took a few days or weeks to move the orders?
20. If one large Aussie bank is getting its hand smacked for AML offences, and another for cartel behaviour (to manage their underwriting exposure) (and probably previously considered normal for the last 40 years by many brokers), is it ok that 4 of them run our 4 largest banks and tell NZ customers to move their insurance to them or they won't get their mortgage?

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