Sanford and Serko were rare bright spots.
New Zealand’s S&P/NZX 50 index joined a rout across Asia as investors grow nervous about what chipmaker Nvidia will deliver when it reposts on Wednesday in the US, and as the track for lower interest rates doesn’t seem as certain.
Heavyweight companies paced the local bourse lower with Meridian Energy, Infratil, Fisher & Paykel Healthcare and Auckland International Airport on the red side of the ledger.
Meanwhile, Serko and Sanford posted the biggest gains on the day as the travel software developer and fishing company exceeded earnings expectations, while Precinct Properties NZ advanced after updating shareholders at commercia landlord’s annual meeting on its development plans.
And Fletcher Building declined after confirming it’s been fielding a wide range of interest in its residential business after The Australian’s DataRoom column reported Jarden is running a sale process and wants first bids before Christmas.
The NZX50 dropped 156.22 points, or 1.2%, to 13,342.82, with 31 stocks declining, 13 gaining, and six unchanged. Turnover across the main board was $172.7 million, of which a2 Milk Co accounted for $21.2 million as it rose 0.8% to $10.76.
Stocks across Asia followed Wall Street lower, with Australia’s S&P/ASX 2300 index down 1.9% in late trading with WiseTech Global and Xero among those pacing declines ahead of the Nvidia result, while Japan’s Nikkei 225 dropped 2.8% as prime minister Sanae Takaichi’s expansive fiscal policy has some traders pondering when the Bank of Japan will need to raise interest rates earlier than anticipated.
The kiwi traded at 87.55 yen at 5pm in Auckland from 87.61 yen yesterday, and fell to 56.48 US cents from 56.63 cents.
Heavyweight companies dragged the NZX50 down, with Meridian Energy falling 2.7% to $5.79 while Infratil declined 2.3% to $11.60, Fisher & Paykel Healthcare slipped 0.9% to $36.64 and Auckland International Airport decreased 1.7% to $7.77.
Tourism Holdings led the index lower, sliding 3.67% to $2.41, while Ryman Healthcare fell 3.2% to $2.76 and Investore Property declined 2.9% to $1.185 after posting a decline in first-half adjusted funds from operations.
Fletcher Building slipped 0.9% to $3.38 after the company confirmed it has fielded interest from multiple parties about its residential development arm, which is under review, after Australian media first reported Jarden is seeking first bids for the business before Christmas.
Separately, Forsyth Barr’s analyst team is cold on Fletcher to take advantage of the economic recovery, preferring the upside on Vulcan Steel, which shed 2% to $7.84 in trading today.
“To be bullish Fletcher Building, one must assume significant structural improvement versus history,” Forsyth Barr analyst Matt Montgomerie said in a note to clients. “Execution on forecast strong earnings growth and a return to historic valuation metrics won’t be enough.”
Sanford posted the biggest gain on the NZX50, up 5% at $6.46 after the fishing group reported another record annual result as profit more than trebled, while Serko climbed 4.1% to $2.55 after the travel software firm lifted first-half income 45% and more than doubled free cash flow.
Precinct Properties NZ was the most heavily traded stock on the day with a volume of 4.2 million shares changing hands as the commercial landlord increased 0.4% to $1.24 after telling shareholders at today’s annual meeting that property valuations have started to stabilise and conditions are improving.
Outside the benchmark index, Comvita fell for another day, down 2% at 48 cents after saying director Zhu Guangping, who is married to cornerstone shareholder Li Wang, won’t seek re-election to the board after next month’s annual meeting.
Reporting by Paul McBeth.
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