New Zealand’s AI play Infratil was among the local leaders on the day.
New Zealand’s S&P/NZX 50 index joined a rally across Asia as Nvidia’s quarterly earnings beat expectations and soothed fears about the frothy valuations underpinning the artificial intelligence sector.
Infratil was among those leading the NZX50 higher, with its CDC data centres unit seen as a local exposure to the AI space, while New Zealand tech stocks Vista Group International and Serko were also stronger.
Power companies were mixed after Meridian Energy’s investor day, where the country’s biggest generator said it’s pushing to tap extra hydro storage at Lake Pūkaki.
Meanwhile, AFT Pharmaceuticals posted the biggest gain among those companies reporting as it notched up a 10th straight gain in first-half revenue and firmed its aspiration for sales of $300 million in the 2027 financial year .
The NZX50 gained 112.5 points, or 0.8%, to 13,439.4, with 33 stocks gaining, 15 declining, and two unchanged. Turnover across the main board was $117.9 million, of which Mainfreight accounted for $12 million as it rose 0.8% to $67.
The local market joined a rally across Asia as Nvidia’s record sales and strong guidance allayed fears that the AI sector has grown overvalued. Australia’s S&P/ASX 200 index jumped 1.2% in late trading, while Japan’s Nikkei 225 was up 2.6% and Hong Kong’s Hang Seng a more modest 0.1%.
“Nvidia’s beat put a dent in the bears’ narrative around the AI bubble,” said Greg Smith, investment specialist at Generate Investment Management. “It provides a bit of comfort when you’ve got surveys showing more than 50% of fund managers think it’s a bubble.”
Infratil was among those leading gainers domestically, rising 3.5% to $11.95, while tech companies Vista Group International and Serko took their cues from offshore, up 2.8% at $2.77 and 1.2% at $2.48 respectively.
SkyCity Entertainment Group led the NZX50 higher, rising 3.7% to 85 cents, while heavyweight Fisher & Paykel Healthcare advanced 1% to $37.14.
Turners Automotive Group gained 0.8% to $7.77 after the company lifted first-half pre-tax earnings 13% and reaffirmed annual guidance for it to be roughly $60 million. The board declared a second-quarter dividend of 8 cents per share.
Retailer KMD Brands gave up some of yesterday’s gains, falling 3.5% to 28 cents to post the biggest decline on the benchmark index. Forsyth Barr analysts raised their target price 2 cents to 32 cents.
Power companies were mixed after Meridian Energy’s investor day briefing pushed the case for more hydro, with the country’s biggest generator seeking fast-track approval to use available unused hydro storage at Lake Pūkaki. Meridian slipped 0.9% to $5.75, and Genesis Energy decreased 0.4% to $2.47, while Contact Energy gained 1% to $9.39 and Mercury NZ climbed 2.1% to $6.45.
The a2 Milk Co decreased 0.5% to $10.70 after the infant formula marketer forecast annual revenue growth to persist in low double-digit figures, and for earnings margins to widen in the current year.
Synlait Milk, which supplies a2, increased 1.4% to 71 cents.
Goodman Property Trust slipped 0.5% to $$2.03 after the industrial landlord lifted first-half cash earnings 6.7% and reaffirmed its annual outlook and forecast distribution of 8 cents per unit.
Outside the benchmark index, Steel & Tube Holdings fell 4.2% to 68 cents after the steel products maker said sales were up 2.4% in the first four months of the financial year, albeit on skinnier earnings.
Fletcher Building was unchanged at $3.37 and Vulcan Steel rose 1.5% to $7.98.
AFT Pharmaceutical climbed 4.6% to $3.40 after the maker of Maxigesic painkillers lifted first-half revenue 33% to a record, and affirmed guidance for an annual operating profit of between $20 million and $24 million. It also said it’s still working towards a $300 million revenue target for the 2027 financial year.
The kiwi dollar clawed back some of its losses against the greenback, trading at 56.08 US cents at 5pm in Auckland from 55.95 cents at 7am and 56.29 cents yesterday. It fell to 86.52 Australian cents from 86.90 cents yesterday.
Reporting by Paul McBeth.
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