Tensions between the US and China reared their head again.
Vista Group International led New Zealand’s S&P/NZX 50 index higher as the cinema analytics firm marked its biggest one-day gain since May after reaffirming its earnings guidance despite a soft box office in the September quarter.
The local gains were broad-based as investors shrugged off wild weather disruptions and power outages around the country, nationwide strikes by public service workers, and a soft lead from New York where weak earnings from Netflix and Tesla sapped investors’ already flaky confidence.
Heartland Group Holdings and Skellerup Holdings both rallied after providing solid trading updates, while Sanford gained as Forsyth Barr analysts raised their target price on the fishing firm ahead of its annual earnings.
And the kiwi dollar fell in the latest bout of risk aversion, with Reuters reporting US President Donald Trump’s considering software restrictions on exports to China amid the waxing and waning sentiment on whether he will meet his Chinese counterpart Xi Jinping later this month.
The NZX50 climbed 70.66 points, or 0.5%, to 13,377.1, with 29 stocks gaining, 15 falling and six unchanged. Turnover across the main board was $146.8 million, of which Fisher & Paykel Healthcare accounted for $24.7 million as it rose 2.1% to $35.75.
New Zealand’s bourse was one of the stronger performers across Asia, with Australia’s S&P/ASX 200 index down 0.1% in late trading and Japan’s Nikkei 225 sliding 1.3%, while Singapore’s Straits Times Index increased 0.1%. India’s Nifty 50 was one of the leaders in the Asian trading session, up 0.8% in late trading.
Wall Street set a soft tone for the local market as Netflix’s miss on earnings sapped the tech-heavy Nasdaq Composite and Tesla’s disappointing quarterly result after the bell pushed afterhours trading even lower. Still, S&P 500 futures have turned and are pointing to a marginally positive opening on Thursday.
Sky Network Television, New Zealand’s dominant pay-TV operator and streaming services provider, fell 1.2% to $3.38, while publisher and radio broadcaster NZME gained 2.4% to $1.07.
Reports that the White House is considering following through on the threat of imposing export restrictions on products using critical US software dented the already soggy investor confidence.
The kiwi dollar fell to 57.25 US cents at 5pm in Auckland from 57.38 cents at 7am and 57.47 cents yesterday, while travel software developer Serko posted the biggest decline on the NZX50, falling 3.6% to $2.65 while utilities software firm Gentrack declined 1.1% to $8.80.
“It wasn’t a great lead from the US,” said Grant Davies, an investment adviser at Hamilton Hindin Greene.
Still, updates from companies today were generally upbeat, following the tentative signs of life in the economy noted at the Fletcher Building, Steel & Tube Holdings and Winton Land annual meetings on Wednesday.
Vista Group International led the benchmark index higher, surging 7% to $2.74 in its biggest one-day gain since May 7 after saying a soft box office in the September quarter hasn’t derailed revenue growth and it reaffirmed annual guidance for earnings margins.
Meanwhile, Skellerup Holdings rose 1.4% to $5.20 after telling shareholders at today’s annual meeting that September quarter earnings rose 10% and it expects annual profit growth of as much as 10%, while Heartland Group Holdings gained 2.8% to $1.09 as it reported improved quarterly earnings and asset quality in its loan book.
Davies said Skellerup’s solid update was in spite the uncertainty it faces in export markets, which have been smoothed by the weaker currency, while Heartland made progress on its bad debts.
Sanford rose 3.5% to $6 after Forsyth Barr analyst Matt Montgomerie kept his ‘outperform’ rating on the stock and raised his target price 25 cents to $7.30, with Fishserve catch data and export prices indicating upside to the fishing company’s annual result when it’s announced next month.
KMD Brands climbed 5.1% to 31 cents after ASX-listed Super Retail’s latest trading update showed rival outdoor equipment chain Macpac’s sales were growing at a rapid clip. Briscoe Group fell 1.5% to $5.12.
Auckland International Airport rose 0.5% to $8.20 after the country’s major gateway told shareholders at today’s annual meeting that it remains cautious about the outlook, with a soft economy and constrained seat capacity. Air New Zealand rose 1.7% to 60 cents.
Precinct Properties NZ was the most heavily traded stock with a volume of 5.1 million shares as it ended the day unchanged at $1.235.
Reporting by Paul McBeth.
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