Scott Tech surges to an 18 month high.
Meridian Energy's Harapaki wind farm.
Heavyweight power companies Meridian Energy and Contact Energy led New Zealand’s S&P/NZX 50 index higher in a broad rally across Asia as US corporate earnings and less inflammatory rhetoric surrounding the US-China relationship helped ease investors’ nerves.
Property for Industry advanced after saying it reckons it’s passed the bottom of the cycle, with floating interest rates settling near the lows projected by the commercial landlord, although that optimism wasn’t felt by other property stocks, which were broadly on the red side of the ledger.
Infratil gained after Forsyth Barr’s research team kept their target price and rating unchanged on the infrastructure investor, while giving it the thumbs up for lifting its stake in Contact as a means to boost cash generation and mitigate the stellar gains of CDC in potentially unbalancing the broader portfolio.
And outside the benchmark index, Scott Technology surged to an 18-month high after reporting record annual earnings and maintaining its dividend, while projecting a strong pipeline of work in the current financial year.
The NZX50 increased 32.89 points, or 0.3%, to 13,377.85, with 22 stocks gaining, 22 declining, and six unchanged. Turnover across the main board was $128.1 million, of which Auckland International Airport accounted for $18.6 million as it increased 0.3% to $8.14.
New Zealand joined a rally across Asia, with Australian miners driving the S&P/ASX 200 index up 0.8% in late trading after prime minister Anthony Albanese and US President Donald Trump agreed to invest US$3 billion in critical minerals projects. Hong Kong’s Hang Seng was up 1.7% in late trading and Japan’s Nikkei 225 index rose 0.8%.
“US reporting seasons is off to a good start with the majority of companies beating analysts’ expectations and that positivity has continued from the US,” said Jeremy Sullivan, an investment adviser at Hamilton Hindin Greene.
Dual-listed miners were mixed on this side of the Tasman, with Santana Minerals up 3.4% at $1.075, while Uvre slipped 1.6% to 30 cents. Gold futures prices eased 0.9% to US$4,356 an ounce.
Manuka Resources dropped 25% to 8.5 cents when it resumed trading after signalling plans to raise A$15 million at 7.5 Australian cents a share to support its New South Wales projects.
New Zealand’s benchmark index was led higher by Meridian Energy, which rose 1.9% to $5.92 after the country’s biggest electricity generator told shareholders at today’s annual meeting the government’s pledge to support new capital projects has the potential to accelerate development, and that the company will be bolder in pursuing new opportunities.
Contact Energy gained 1.6% to $9.30, while Mercury NZ slipped 0.5% to $6.62 and Genesis Energy was unchanged at $2.47.
Infratil, which this week lifted its stake of Contact, gained 1% to $12.49 after Forsyth Barr analyst Ben Crozier kept his target price on the infrastructure investor at $13.25 and affirmed his ‘neutral’ rating, saying the increased Contact holding is in line with the firm’s strategy for cashflow generation and helps balance the broader portfolio from being overwhelmed by the strong CDC performance.
Property for Industry advanced 0.4% to $2.46 after the commercial landlord told shareholders at today’s annual meeting that the valuation cycle is turning and floating interest rates are near projected lows, meaning the broader environment has improved for the firm.
Other property companies were generally weaker as Precinct Properties NZ fell 1.6% to $1.23, Investore Property slipped 0.8% to $1.21, and Goodman Property Trust decreased 0.5% to $2.13. Stride Property Group gained 1.1% to $1.435.
Tourism Holdings posted the biggest decline on the NZX50, falling 3.5% to $2.47, while Serko declined 3.1% to $2.81.
Spark New Zealand was most heavily traded stock with a volume of 3.8 million as it ended the day unchanged at $2.39.
Outside the benchmark index, Scott Technology hit an 18-month high, ending the day up 12% at $3.09 after reporting a 19% lift in annual earnings to a record and maintaining its annual dividend at 8 cents a share. The company’s shares are up 39% so far this year.
Comvita was unchanged at 76 cents after co-founder Alan Bougen said he’s still working on an alternative proposal to the Mark Stewart-backed Florenz’s scheme to buy the honey products maker for 80 cents a share, and hasn’t received binding commitments to block the pursuit.
Metro Performance Glass increased 2.2%, or 0.1 of a cent, to 4.7 cents after would-be suitor Viridian withdrew its application with the Commerce Commission seeking clearance to buy the rival glass products maker.
Being AI’s volatility continued as it gained 10% to 19.8 cents. NZ RegCo today issued a trade with caution notice on the company over its 92% rally since early September.
The kiwi dollar traded at 57.29 US cents at 5pm in Auckland from 57.46 cents at 7am and 57.32 cents yesterday after Statistics New Zealand figures showed the nation’s exports rose 19% in September from a year earlier, with strong Chinese demand for dairy products.
Reporting by Paul McBeth.
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